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AGENCY:

Office for Civil Rights, Office of the Secretary, Department of Health and Human Services; Centers for Medicare & Medicaid Services, Department of Health and Human Services.

ACTION:

Final rule and interpretation.

SUMMARY:

The Department of Health and Human Services (HHS or the Department) is issuing this final rule regarding section 1557 of the Affordable Care Act (ACA) (section 1557). Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs and activities. Section 1557(c) of the ACA authorizes the Secretary of the Department to promulgate regulations to implement the nondiscrimination requirements of section 1557. The Department is also revising its interpretation regarding whether Medicare Part B constitutes Federal financial assistance for purposes of civil rights enforcement. Additionally, the Department is revising provisions prohibiting discrimination on the basis of sex in regulations issued by the Centers for Medicare & Medicaid Services (CMS) governing Medicaid and the Children's Health Insurance Program (CHIP); Programs of All-Inclusive Care for the Elderly (PACE); health insurance issuers and their officials, employees, agents, and representatives; States and the Exchanges carrying out Exchange requirements; agents, brokers, or web-brokers that assist with or facilitate enrollment of qualified individuals, qualified employers, or qualified employees; issuers providing essential health benefits (EHB); and qualified health plan issuers.

DATES:

Effective date: July 5, 2024.

Applicability dates: Unless otherwise specified, the provisions of this final rule apply on or after July 5, 2024. See the SUPPLEMENTARY INFORMATION section for additional information.

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FOR FURTHER INFORMATION CONTACT:

Office for Civil Rights

Daniel Shieh, Associate Deputy Director, HHS Office for Civil Rights (202) 240-3110 or (800) 537-7697 (TDD), or via email at 1557@hhs.gov, for matters related to section 1557.

Centers for Medicare & Medicaid Services

John Giles, (410) 786-5545, for matters related to Medicaid.

Meg Barry, 410-786-1536, for matters related to CHIP.

Timothy Roe, (410) 786-2006 for matters related to Programs of All-Inclusive Care for the Elderly.

Becca Bucchieri, (301) 492-4341 or Leigha Basini, (301) 492-4380, for matters related to 45 CFR 155.120, 155.220, 156.125, 156.200, and 156.1230.

Lisa Cuozzo, (410) 786-1746, for matters related to 45 CFR 147.104.

Hannah Katch, (202) 578-9581, for general questions related to CMS amendments.

Assistance to Individuals With Disabilities in Reviewing the Rulemaking Record: Upon request, the Department will provide an accommodation or appropriate auxiliary aid or service to an individual with a disability who needs assistance to review the comments or other documents in the public rulemaking record for the final rule. To schedule an appointment for this type of accommodation or auxiliary aid, please call (202) 240-3110 or (800) 537-7697 (TDD) for assistance or email 1557@hhs.gov.

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SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background

A. Regulatory History

B. Overview of the Final Rule

II. Provisions of the Proposed Rule and Analysis and Responses to Public Comments

Subpart A—General Provisions

Purpose and Effective Date (§ 92.1)

Application (§ 92.2)

Treatment of the Title IX Religious Exception

Relationship to Other Laws (§ 92.3)

Definitions (§ 92.4)

Assurances Required (§ 92.5)

Remedial Action and Voluntary Action (§ 92.6)

Designation and Responsibilities of a Section 1557 Coordinator (§ 92.7)

Policies and Procedures (§ 92.8)

Training (§ 92.9)

Notice of Nondiscrimination (§ 92.10)

Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11)

Data Collection

Subpart B—Nondiscrimination Provisions

Discrimination Prohibited (§ 92.101)

Subpart C—Specific Applications to Health Programs and Activities

Meaningful Access for Individuals With Limited English Proficiency (§ 92.201)

Effective Communication for Individuals With Disabilities (§ 92.202)

Accessibility for Buildings and Facilities (§ 92.203)

Accessibility of Information and Communication Technology for Individuals With Disabilities (§ 92.204)

Requirement To Make Reasonable Modifications (§ 92.205)

Equal Program Access on the Basis of Sex (§ 92.206)

Nondiscrimination in Health Insurance Coverage and Other Health-Related Coverage (§ 92.207)

Prohibition on Sex Discrimination Related to Marital, Parental, or Family Status (§ 92.208)

Nondiscrimination on the Basis of Association (§ 92.209)

Nondiscrimination in the Use of Patient Care Decision Support Tools (§ 92.210)

Nondiscrimination in the Delivery of Health Programs and Activities Through Telehealth Services (§ 92.211)

Subpart D—Procedures

Enforcement Mechanisms (§ 92.301)

Notification of Views Regarding Application of Federal Religious Freedom and Conscience Laws (§ 92.302)

Procedures for Health Programs and Activities Conducted by Recipients and State Exchanges (§ 92.303)

Procedures for Health Programs and Activities Administered by the Department (§ 92.304)

III. Change in Interpretation—Medicare Part B Funding Meets the Definition of Federal Financial Assistance; Responses to Public Comment

IV. CMS Amendments

A. Medicaid and Children's Health Insurance Program (CHIP)

B. Programs of All-Inclusive Care for the Elderly (PACE)

C. Insurance Exchanges and Group and Individual Health Insurance Markets

1. Comments and Responses to 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b)

2. Health Insurance Exchanges

a. Non-Interference With Federal Law and Nondiscrimination Standards (45 CFR 155.120)

b. Federally-Facilitated Exchange Standards of Conduct (45 CFR 155.220)

c. Essential Health Benefits Package: Prohibition on Discrimination (45 CFR 156.125)

d. QHP Issuer Participation Standards (45 CFR 156.200)

e. Direct Enrollment With the QHP Issuer in a Manner Considered To Be Through the Exchange (45 CFR 156.1230)

3. Prohibition of Discrimination—Group and Individual Health Insurance Markets Guaranteed Availability of Coverage (45 CFR 147.104)

V. Executive Order 12866 and Related Executive Orders on Regulatory Review

A. Regulatory Impact Analysis

a. Baseline Conditions

b. Costs of the Final Rule Start Printed Page 37523

c. Total Quantified Costs

3. Discussion of Benefits

4. Analysis of Regulatory Alternatives to the Final Rule

B. Regulatory Flexibility Act—Final Small Entity Analysis

1. Entities That Will Be Affected

a. Physicians

b. Pharmacies

c. Health Insurance Issuers

d. Local Government Entities

2. Whether the Rule Will Have a Significant Economic Impact on Covered Small Entities

C. Executive Order 12250 on Leadership and Coordination of Nondiscrimination Laws

D. Paperwork Reduction Act

1. ICRs Regarding Assurances (§ 92.5)

2. ICRs Regarding Section 1557 Coordinator (§ 92.7) and Training (§ 92.9)

3. ICRs Regarding Notice of Nondiscrimination (§ 92.10) and Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11)

E. Assessment of Federal Regulation and Policies on Families

I. Background

Section 1557 of the Affordable Care Act (ACA) (section 1557), 42 U.S.C. 18116, prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in a health program or activity, any part of which is receiving Federal financial assistance, including credits, subsidies, or contracts of insurance, except where otherwise provided in title I of the ACA. Section 1557 also prohibits discrimination on the basis of race, color, national origin, sex, age, or disability under any program or activity that is administered by an executive agency, or any entity established under title I of the ACA or its amendments. The statute cites title VI of the Civil Rights Act of 1964 (title VI), 42 U.S.C. 2000d et seq., title IX of the Education Amendments of 1972 (title IX), 20 U.S.C. 1681 et seq., the Age Discrimination Act of 1975 (Age Act), 42 U.S.C. 6101 et seq., and section 504 of the Rehabilitation Act of 1973 (section 504), 29 U.S.C. 794, to identify the grounds of discrimination prohibited by section 1557. The entities to which section 1557 and this final rule apply ( i.e., recipients of Federal financial assistance, the Department, and title I entities) are collectively referred to as “covered entities.” The statute further specifies that the enforcement mechanisms provided for and available under title VI, title IX, the Age Act, or section 504 shall apply for purposes of violations of section 1557, 42 U.S.C. 18116(a). The statute authorizes the Secretary of the U.S. Department of Health and Human Services (HHS or the Department) to promulgate implementing regulations for section 1557, 42 U.S.C. 18116(c).

A. Regulatory History

On August 1, 2013, the HHS Office for Civil Rights (OCR) published a Request for Information in the Federal Register , 78 FR 46558,^[1] followed by issuance of a notice of proposed rulemaking (NPRM) on September 8, 2015 (2015 NPRM), 80 FR 54171.^[2] OCR finalized the first section 1557 regulation on May 18, 2016 (2016 Rule), 81 FR 31375. On June 14, 2019, the Department published a new section 1557 NPRM (2019 NPRM), 84 FR 27846, proposing to rescind and replace large portions of the 2016 Rule.^[3] On June 12, 2020, OCR publicly posted its second section 1557 final rule (2020 Rule), which was published in the Federal Register on June 19, 2020, 85 FR 37160. The 2020 Rule remains in effect, save for the parts enjoined or set aside by courts, until the effective date of this final rule. In the meantime, entities that are subject to the 2020 Rule must continue to comply with the parts of the 2020 Rule that remain in effect.

On January 5, 2022, the Department proposed to amend CMS regulations such that Exchanges, issuers, and agents and brokers would be prohibited from discriminating against consumers based on their sexual orientation or gender identity in the HHS Notice of Benefit and Payment Parameters for 2023 NPRM, 87 FR 584 (January 5, 2022). CMS did not finalize the amendments in the Notice of Benefit and Payment Parameters for the 2023 final rule, 87 FR 27208 (May 6, 2022); instead, CMS proposed to make the amendments to its regulations in forthcoming Departmental rulemaking.

On July 25, 2022, OCR publicly posted the section 1557 NPRM associated with this rulemaking (2022 NPRM or Proposed Rule), which was published in the Federal Register on August 4, 2022, 87 FR 47824. OCR invited comment on the Proposed Rule by all interested parties. The comment period ended on October 3, 2022. In total we received 85,280 comments on the Proposed Rule.^[4] Comments came from a wide variety of stakeholders, including but not limited to: civil rights/advocacy groups, including language access organizations, disability rights organizations, women's advocacy organizations, and organizations serving lesbian, gay, bisexual, transgender, queer, or intersex (LGBTQI+) individuals; health care providers; consumer groups; religious organizations; academic and research institutions; reproductive health organizations; health plan organizations; health insurance issuers; State and local agencies; and tribal entities. Of the total comments, 79,126 were identified as being submitted by individuals. Of the 85,280 comments received, 70,337 (80 percent) were form letter copies associated with 30 distinct form letter campaigns.

B. Overview of the Final Rule

Section 1557

This preamble is divided into multiple sections: section II describes changes to the section 1557 regulation and contains four subparts: subpart A sets forth the rule's general provisions; subpart B contains the rule's nondiscrimination provisions; subpart C describes specific applications of the prohibition on discrimination to health programs and activities; and subpart D describes the procedures that apply to enforcement of the rule. Section III provides official notice of HHS's change in interpretation that Medicare Part B meets the definition of “Federal financial assistance.” Section IV describes changes to CMS regulations.

OCR has made some changes to the Proposed Rule's provisions, based on the comments we received. Among the changes are the following:

OCR modified proposed § 92.4 (Definitions) to include new definitions for telehealth, State, relay interpretation, and patient care decision support tools.

OCR modified proposed § 92.201 (Meaningful access for individuals with limited English proficiency) to change “limited English proficient individual” to “individual with limited English proficiency” where applicable in this provision and elsewhere where the term is used. The text for proposed § 92.201(a) was updated to include “companions with limited English proficiency” for clarity and parity with the rule's effective communication Start Printed Page 37524 provision. OCR also modified proposed § 92.201(f) and proposed § 92.201(g) to address concerns that audio and video remote interpreting may not be appropriate to provide meaningful access in certain circumstances.

OCR modified proposed § 92.206 (Equal program access on the basis of sex) to clarify a covered entity's ability to raise legitimate and nondiscriminatory reasons for the denial of care under this provision, while stating that the basis for a denial or limitation must not be based on unlawful animus or bias, or constitute a pretext for discrimination.

OCR modified the text of proposed § 92.207 (Nondiscrimination in health insurance coverage and other health-related coverage), consistent with changes to § 92.206(c) to clarify that covered entities may raise a legitimate, nondiscriminatory reason for denials or limitations of health services in benefit design and in individual cases, while stating that the basis for a denial or limitation must not be based on unlawful animus or bias, or constitute a pretext for discrimination.

OCR revised proposed § 92.210 (Nondiscrimination in the use of clinical algorithms in decision-making) to change “clinical algorithms” and “clinical algorithms in decision-making” to “patient care decision support tools.” OCR further specified the scope of the application of this provision and the requirement that covered entities take reasonable steps to mitigate discrimination once made aware of the potential for discrimination resulting from use of these tools.

OCR modified proposed § 92.302 (Notification of views regarding application of Federal religious freedom and conscience laws) to clarify the application of religious freedom and conscience laws, and aspects of the administrative process set forth in the provision, including that a recipient may request an assurance of an exemption under such laws, the availability of a temporary exemption, and the availability of an administrative appeal process.

CMS Amendments

In response to comments, CMS is finalizing the proposed amendments to the CMS regulations with a revision to scope of sex discrimination to be consistent with section 1557's regulatory text at § 92.101(a)(2).

II. Provisions of the Proposed Rule and Analysis and Responses to Public Comments

Subpart A—General Provisions

Purpose and Effective Date (§ 92.1)

In the 2022 NPRM, proposed § 92.1(a) explained that the purpose of 45 CFR part 92 is to implement section 1557, which prohibits discrimination in certain health programs and activities on the “ground[s] prohibited” under title VI, title IX, the Age Act, or section 504. Section 1557 adopts the grounds of these statutes and prohibits discrimination based on race, color, national origin, sex, age, or disability.^[5]

Proposed § 92.1(b) provided that the effective date of the section 1557 implementing regulation shall be 60 days after the publication of a final rule in the Federal Register and provided a delayed implementation date (referred to as “applicability date” in this final rule) for provisions of this part that require changes to health insurance or group health plan benefit design.

The comments and our responses regarding the purpose and effective date are set forth below.

Comment: Several commenters noted that the regulatory purpose described in the 2022 NPRM strengthens nondiscrimination protections in health care, and appropriately aligns with section 1557's statutory text and Congressional intent.

Response: As commenters noted, the 2022 NPRM's purpose is to prohibit discrimination in accordance with section 1557's statutory text. The Proposed Rule mirrors the statutory text and clarifies that the purpose of this rule is to regulate health programs and activities conducted and funded by the Department and those of title I entities. Thus, we maintain the regulatory language for § 92.1(a) as proposed in the 2022 NPRM.

Comment: One commenter observed that, in addition to title IX's general prohibition of discrimination on the ground of “sex,” section 904 of title IX (20 U.S.C. 1684) also prohibits discrimination on the ground of blindness or severe vision impairment.

Response: Both HHS's and the Department of Education's title IX regulations define title IX to exclude section 906. See45 CFR 86.2(a); 34 CFR 106.2(a). While 20 U.S.C. 1684 prohibits certain forms of discrimination on the ground of blindness or severe vision impairment, such conditions are disabilities and section 1557 prohibits discrimination on the basis of disability as it is the “ground” of discrimination prohibited by the statute's reference to section 504. Accordingly, we decline to revise the regulatory text at § 92.1(a).

Comment: OCR received many comments about the proposed 60-day effective date for requirements other than those related to health insurance or group health plan coverage benefit design. Commenters identified several tasks covered entities would need to accomplish to comply with the final rule requirements within the proposed 60 days, including updating existing policies and procedures; developing and reviewing new content; developing written communications with members and distributing written documents, including preparing additional mailings; and familiarizing themselves with new requirements and OCR-provided tools and resources.

Most of these commenters expressed concern that covered entities would not be able to develop and implement the required policies and procedures (§ 92.8) and notices (§ 92.10, § 92.11), or complete the proposed training requirement (§ 92.9) within the allotted 60 days. A variety of commenters argued that the 60-day effective date for §§ 92.7 through 92.11 would be unreasonable for all covered entities, requesting that OCR consider allowing covered entities more time to come into compliance with the final rule.

Commenters' recommended compliance timeframes varied widely, from 180 days to three years following publication of the final rule in the Federal Register . One commenter asked that, for the first 18 to 24 months following publication of the final rule in the Federal Register , OCR's section 1557 enforcement efforts, including complaint investigations, primarily focus on providing covered entities technical assistance with respect to their section 1557 obligations.

Response: OCR appreciates comments regarding the effective date and commenters' identification of factors influencing feasibility of a single effective date for all section 1557 requirements. We are maintaining the overall 60-day effective date related to the general prohibition on discrimination on the basis of race, color, national origin, sex, age, and disability. This is consistent with the approach taken with respect to the effective date of our previous Start Printed Page 37525 rulemakings.^[6] However, in light of the comments received, OCR has determined that it is reasonable to allow additional time for covered entities to comply with certain procedural requirements. The additional time will provide covered entities with the opportunity to properly designate a Section 1557 Coordinator and designee(s) (as applicable); develop and tailor to their respective organization's policies and procedures; train relevant staff; and develop their required notices. For this reason, we are adopting phased-in applicability dates for certain provisions, as reflected in the chart at the end of this section.

Comment: Some commenters requested that OCR allow for temporary safe harbors for covered entities' compliance with certain aspects of the final rule. Specifically, commenters suggested that the final rule allow for an 18-month good faith safe harbor for covered entities currently operating in accordance with the 2016 Rule language access requirements, particularly the notice and tagline requirements at former 45 CFR 92.8.

Response: OCR declines to grant safe harbors for covered entities that are or have been operating in accordance with the 2016 Rule's notice and tagline requirements. Granting such a safe harbor would fail to recognize the importance of this final rule's requirement. The Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (“Notice of Availability”) at § 92.11 requires notice of auxiliary aids and services in addition to language assistance services, which we have now revised to reflect a delayed applicability date of one year from the effective date. This revised applicability date reasonably allows enough time for covered entities to come into compliance with the Notice of Availability provision.

Comment: Comments from organizational health insurance issuers generally supported the Proposed Rule's delayed applicability date for provisions that require changes to health insurance or group health plan coverage benefits or benefit design, which proposed a delayed applicability date of the first day of the first plan year beginning on or after the year following the effective date of the final rule's publication in the Federal Register .^[7] One commenter generally requested that OCR provide flexibility for plans depending on when the rule is finalized. Another commenter specifically requested that OCR consider allowing a temporary safe harbor compliance exception for group health plans and health insurance issuers of group health insurance coverage so that plan design changes for non-calendar-year plans may be implemented the first day of the new plan year occurring on or after January 1, 2024.

Response: OCR is cognizant that health insurance issuers and group health plans develop their health insurance coverage and other health-related coverage benefit designs in advance of the plan year that the coverage is offered. Accordingly, we are including a delayed applicability date to the extent that the final rule's provisions require changes to health insurance coverage or other health-related coverage, including group health plan coverage benefit design for health insurance coverage or other health-related coverage that is newly subject to certain provisions of § 92.207 (Nondiscrimination in health insurance coverage and other health-related coverage). In such circumstances, the final rule's applicability date is the first day of the first plan year beginning on or after January 1, 2025. This delayed applicability date applies equally to health insurance issuers and group health plans that are offering calendar-year and non-calendar-year plans. For example, a newly covered group health plan eligible for the delayed applicability date that offers a non-calendar year plan effective July 1, 2024, would have until the following plan year, effective July 1, 2025, to comply with the benefit design requirements, as July 1, 2025, would be the first day of the first plan year beginning on or after January 1, 2025.

The 2020 Rule remains in effect until the effective date of this final rule. In the interim, covered entities that are subject to the 2020 Rule must continue to comply with the parts of the 2020 Rule that remain in effect. Notwithstanding the repeal of the former § 92.207 (2016 Rule), the 2020 Rule prohibits discrimination in health insurance coverage that receives Federal financial assistance. Consistent with the 2020 Rule preamble, OCR interprets and enforces section 1557 under the 2020 Rule to prohibit discrimination in benefit design in health insurance coverage and other health-related coverage that receive Federal financial assistance.^[8]

As such coverage is currently prohibited from having discriminatory benefit designs, the obligation to comply with this final rule's § 92.207(b)(1) through (5) does not require a delayed applicability date. Therefore, we have revised the delayed applicability date for § 92.207(b)(1) through (5) under § 92.1(b) to reflect that the delayed applicability date is for health insurance coverage and other health-related coverage that are not already subject to this part as of the date of publication of this final rule. Because § 92.207(b)(6) (most integrated setting) describes a category of prohibited benefit design features that OCR is not explicitly enforcing under the 2020 Rule, OCR will not enforce this provision until the delayed applicability of the first day of the first plan year beginning on or after January 1, 2025. The delayed applicability date for all provisions of § 92.207 is in effect for covered health insurance coverage and other health-related coverage that are not subject to the 2020 Rule as of the date of publication of this final rule and are therefore newly subject to this final rule.

Examples of health insurance coverage or other health-related coverage subject to the 2020 Rule (and thus the benefit design provisions under § 92.207(b)(1) through (5) as of July 5, 2024) include but are not limited to Medicare Advantage plans, Medicare Part D plans, Medicaid managed care plans, and qualified health plans.^[9] For complaints received prior to January 1, 2025 alleging discrimination related to benefit design, OCR will examine whether the health insurance coverage or other health-related coverage is subject to the 2020 Rule. If OCR determines the coverage was subject to Start Printed Page 37526 the 2020 Rule, the covered entity providing the coverage is responsible for complying with the specific benefit design provisions of § 92.207(b)(1) through (5) on July 5, 2024. In its review of such complaints, OCR will consider the nature of the challenged benefit design feature and whether it would have been prohibited under the 2020 Rule. For example, a Medicare Advantage plan that imposes additional cost-sharing for health services related to a particular disease but not for other diseases would be investigated as potentially discriminatory under the 2020 Rule and under this final rule as of its general 60-day effective date. However, if a Medicare Advantage plan contains a potentially discriminatory design feature related to integration, OCR would not investigate such an allegation under this final rule unless the alleged discrimination took place after the delayed applicability date of the first day of the first plan year beginning on or after January 1, 2025.

Further, OCR clarifies that any covered entity offering health insurance coverage or other health-related coverage subject to the delayed applicability date for benefit design is still required to comply with all other provisions of this final rule, as of the general effective dates and specific applicability dates set forth under § 92.1(b).

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions in § 92.1(a) as written and amending § 92.1(b), with modifications.

In § 92.1(b), we have included a table that clearly provides the applicability date for each provision. It appears below:

Application (§ 92.2)

Proposed § 92.2 addressed the application of this regulation. OCR proposed in § 92.2(a) to apply the final rule, except as otherwise provided in the regulation, to: (1) every health program or activity, any part of which receives Federal financial assistance, directly or indirectly, from the Department; (2) every health program or activity administered by the Department; and (3) every program or activity administered by a title I entity. Title I entities include State Exchanges (including those on the Federal platform) and Federally-facilitated Exchanges, both of which were created under title I of the ACA.^[10]

In § 92.2(b), we proposed that this regulation would not apply to an employer with regard to its employment practices, including the provision of employee health benefits. We noted that, although the 2016 and 2020 Rules applied to employment in very limited circumstances, OCR determined that the proposed approach would minimize confusion among individuals seeking relief under Federal Equal Employment Opportunity laws and would promote clarity regarding the filing and processing of employment discrimination complaints. We stated our belief that, as is the case with employment discrimination complaints generally, concerns regarding the provision of employee health benefits are best resolved by our Federal partners.

In § 92.2(c), we proposed that if any provision of this regulation is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, it shall be severable from this part and not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other, dissimilar circumstances.

We invited comment on the effects of the proposed scope of application of the regulation, including the application of this part to recipients of Federal financial assistance from executive agencies other than the Department; the application to programs and activities of the Department and other executive agencies; and the application to employment.

The comments and our responses regarding § 92.2 are set forth below.

Comment: Many commenters supported § 92.2(a), which commenters said would reinstate the scope of the section 1557 implementing regulation to that of the 2016 Rule and recognizes that section 1557 applies to Federal programs like Medicaid and Medicare, the State and Federal Marketplaces (referred to as “Exchanges” in this final rule) and the plans sold through them, as well as other commercial health plans if the issuer receives any form of Federal financial assistance. Commenters noted that ensuring section 1557 protections apply broadly to an array of entities and programs will ensure the greatest level of protection for individuals against discriminatory actions that may interfere with access to health care and health care coverage.

Many commenters noted that the Proposed Rule was consistent with congressional intent. These commenters noted that Congress was clear in extending nondiscrimination protections to a broad array of health programs and activities, and that section 1557 was intended to build and expand upon existing civil rights laws, while Start Printed Page 37527 providing broad protection against discrimination in health care. These commenters further noted that Congress has repeatedly expressed that it intends civil rights laws to be broadly interpreted in order to effectuate their remedial purposes. Commenters also noted that the purpose of the ACA itself is to ensure broad access to and coverage of health care.

Response: We agree that section 1557 protections apply broadly and that this final rule is the best reading of the statute regarding the scope of applicability; as such, the 2022 NPRM properly identified those entities that are covered under section 1557.

Regarding plans sold through State and Federally-facilitated Exchanges, as discussed under the definition of “Federal financial assistance” at § 92.4, such plans are covered under this rule as a health program or activity when in receipt of Federal financial assistance, such as advance payments of the premium tax credit. This is consistent with the 2016 Rule. Further, as discussed under the definition of “health program or activity” at § 92.4, a health insurance issuer's other commercial health plans are covered under this final rule as part of the issuer's operations where the issuer is principally engaged in the provision or administration of any health projects, enterprises, ventures, or undertakings. For more information on the final rule's application to all operations of a health insurance issuer that is so principally engaged, please see the discussion below under the definition of “health program or activity” at § 92.4.

Comment: Some commenters requested that OCR clarify the extent to which a covered entity is required to oversee the section 1557 compliance of its vendors and subcontractors. For example, a health insurance issuer commented that an issuer should not be responsible for the discriminatory actions of a provider or facility with which the issuer has contracted for the provision of medical services. Another commenter requested clarification on when health insurance agents and brokers are subject to the rule, particularly when they are working under the auspices of a covered entity, such as an Exchange or a health insurance issuer. Other commenters suggested that subcontractors should be considered recipients by virtue of contracting with a recipient of Federal financial assistance.

Response: Health programs or activities may comprise more than one recipient of Federal financial assistance. For example, a primary recipient (or “direct” recipient) is an entity that accepts Federal financial assistance from a Federal agency. The direct recipient may then distribute the Federal financial assistance to a subrecipient (or “indirect” recipient) to carry out all or part of the health program or activity. Primary recipients and all subrecipients are covered and must comply with section 1557.^[11] Under general civil rights principles, both the primary recipient and subrecipient are responsible for complying with applicable civil rights laws.^[12] Therefore, if an entity receives Federal financial assistance—directly as a primary recipient or indirectly as a subrecipient—it would be a covered entity and responsible for complying with section 1557 and the part.

While both direct and indirect recipients must comply with section 1557 independently, a direct recipient may not absolve itself of its obligations by contracting with another entity to provide services or assistance for which it received Federal financial assistance or using an agent to do so.^[13] Covered entities are responsible for the conduct of their subcontractors and cannot contract away their civil rights obligations through contractual arrangements with subcontractors. For example, section 1557 and the statutes referenced therein may cover a contractor that performs an essential function for the recipient, making the contractor itself a recipient. In Frazier v. Board of Trustees, 765 F.2d 1278, amended, 777 F.2d 329 (5th Cir. 1985), a case involving section 504, the court noted that the defendant hospital contracted out core medical functions, for which it received Federal financial assistance. The court ruled that this financial assistance to the hospital “would not have been [provided] at all were it not for [the contractor's] performance as a de facto subdivision of [the hospital],” and thus the contractor qualified as a recipient for purposes of section 504, id. at 1289-90.^[14]

The obligation of health insurance agents and brokers as subcontractors is a fact-specific analysis depending on the contractual arrangement with a covered entity. If an Exchange or recipient, such as a health insurance issuer, contracts with an agent or broker to carry out responsibilities of the covered entity's health program or activity and uses Federal financial assistance to pay the agent or broker, then the agent or broker is a subrecipient and thus independently subject to all the provisions of section 1557. If a contractor does not receive Federal financial assistance—either as a primary recipient or subrecipient—it is not a recipient of Federal financial assistance and not subject to section 1557. We note that agents and brokers under contract with an Exchange could also be covered by the final rule as a health program or activity administered by a title I entity under § 92.2(a)(3). Conversely, if the agent or broker is assisting the public with purchasing health insurance coverage without any contractual arrangement on behalf of an Exchange or recipient and is not otherwise receiving Federal financial assistance, then they would not be considered subrecipients or subcontractors subject to the rule.

Comment: Some commenters stated that because the Federal Government now extensively subsidizes both medical care and health insurance coverage and other health-related coverage, the final rule will apply to practically all health care entities. They argued that because of this, it would be nearly impossible for medical professionals to work free of these regulations and, as a result, physicians and faith-based health care entities would effectively be barred from refusing to participate in pregnancy termination procedures.

Response: It has long been established that when an entity receives Federal funds, conditions may be placed on the receipt of those funds.^[15] Not all providers receive Federal financial assistance; however, when they do, they must comply with applicable law. The Start Printed Page 37528 rule, however, does not ban physicians and faith-based or other health care entities from refusing to participate in pregnancy termination procedures. On the contrary, the ACA itself provides that “[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.” 42 U.S.C. 18023(c)(2)(A).^[16] In addition, the rule has been revised at § 92.3(c) to recognize that, “[i]nsofar as the application of any requirement under this part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required.” Further, in this final rule, the process regarding exemptions related to religious freedom and conscience protections has been clarified. See § 92.302.

Comment: Some commenters supported the restoration of section 1557's application to all health programs or activities administered by the Department under § 92.2(a)(2). These commenters noted that the 2020 Rule exempts from section 1557 most of the Department's programs and activities by limiting the application to only those programs and activities established under title I of the ACA. These commenters opined that such an interpretation is contrary to the statutory text, design, and intent of section 1557 and the ACA generally. Other commenters noted that consistently applying section 1557 requirements throughout various programs, including the Department's programs, creates continuity in the interpretation and implementation of nondiscrimination standards. However, some commenters stated that OCR did not provide adequate explanation as to why this change in application is necessary or appropriate.

Response: For the reasons discussed in the 2022 NPRM, 87 FR 47838, applying this rule to all health programs and activities administered by the Department, not just those programs and activities established under title I of the Act, is the best reading of the statutory text of section 1557. The statutory language provides that section 1557's discrimination prohibitions apply to “any program and activity that is administered by an executive agency or any entity established under this title.” 42 U.S.C. 18116(a). As discussed in the 2022 NPRM, the operative word, “or,” distinguishes programs and activities operated by an executive agency from those operated by a title I entity. 87 FR 47829. To the extent there is ambiguity in the interpretation, finalizing the rule as proposed better reflects the statutory language as well as Congress's intent.^[17] The application of section 1557 to every health program or activity administered by the Department ensures that nondiscrimination standards are interpreted and applied as consistently and as broadly as possible and provides for application of nondiscrimination standards to the Department consistent with the entities to which it provides Federal financial assistance.

Comment: Some commenters noted that under the most straightforward reading of section 1557, the regulatory framework should encompass all of the Department's programs and activities, not just “health” programs and activities, and they suggested that the Department extend the regulation's protections accordingly.

Response: We appreciate commenters' views on this issue. As we noted in the 2022 NPRM, OCR considered applying the rule to all programs and activities of the Department and sought comment on this issue. 87 FR 47838. Based on comments received and additional consideration, we are applying the final rule to the Department's health programs and activities, rather than all the Department's programs and activities, at this time. The Department may consider future rulemaking at a later date. For this final rule, however, OCR has determined that it is appropriate to apply the rule to the Department's “health” programs and activities given that the ACA itself is principally related to health care and the entirety of this section 1557 rulemaking seeks to regulate “health” programs and activities.

Comment: Commenters supported the rule's application to programs and activities administered by title I entities under § 92.2(a)(3), stating it was consistent with statutory text, Congressional intent, and the nondiscrimination purpose of section 1557 and the ACA.

Response: Proposed § 92.2(a)(3) applied section 1557 to “every program or activity administered by a title I entity.” In the 2022 NPRM, 87 FR 47838, OCR explained that it was unnecessary to include the modifier “health” to programs or activities of a title I entity because title I entities already meet the definition of “health program or activity” as set forth under § 92.4. While this remains true, we have reevaluated the regulatory text of § 92.2(b)(3) and determined that it should be revised to add the modifier “health” to a title I entity's “program or activity” for consistency with our interpretation that section 1557 applies to the Department's “health” programs or activities, as discussed in the previous comment. This technical revision does not limit or alter the scope of § 92.2(b)(3)'s application to the programs or activities of a title I entity, as we articulated in the 2022 NPRM. 87 FR 47838.

Comment: A few commenters opined that the rule should apply broadly to recipients of Federal financial assistance from any executive agency, not just the Department. These commenters noted that nothing in the statute suggests that Congress intended to limit the scope of section 1557's application in such a way.

Response: It is OCR's longstanding position that section 1557's discrimination prohibition is not limited to recipients of Federal financial assistance from the Department, but rather covers recipients' health programs or activities regardless of the executive agency providing the funding.^[18] However, the final rule only applies to recipients of HHS funding, which is consistent with OCR's delegation of authority to “develop and direct implementation of the requirements of Section 1557 . . . as applied to the Department and recipients of the Department's funds.” 85 FR 37242 (emphasis added). Other Federal agencies possess section 1557 enforcement responsibility for the health programs and activities they fund and administer.

Comment: Some commenters recommended that the Department provide a model for other agencies to craft their own, more inclusive, and Start Printed Page 37529 more protective rules for non-health-related programs in line with other applicable non-discrimination statutes.

Response: OCR appreciates this recommendation and reiterates its desire to work with other agencies as necessary and appropriate. OCR only has authority to apply section 1557 to HHS and recipients of Departmental Federal financial assistance. This rule does not apply to programs and activities of other agencies and OCR is unable to regulate other agencies.

Comment: A number of commenters disagreed with the non-application of the rule to employment practices under § 92.2(b). Commenters opined that the categorical exclusion of employers is inconsistent with section 1557's statutory text and creates confusion. Some commenters noted that an agency to whom a complaint is referred may not adequately address claims of discrimination, including those of dependents. Commenters further noted that other employment discrimination laws, such as title VII of the Civil Rights Act of 1964 (title VII), 42 U.S.C. 2000e et seq., and the Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. 621-634, require a claimant to file a complaint with a Federal agency before privately enforcing their rights. Some commenters requested that OCR clarify that this provision concerns only the processing of administrative complaints by OCR and that OCR's decision not to apply this rule to employment practices does not preclude employees from vindicating their section 1557 rights in court.

Other commenters supported proposed § 92.2(b) and noted it will help prevent wasteful duplication with other Federal laws and agencies that already cover unlawful employment discrimination.

Response: The Supreme Court has recognized that section 1557 authorizes a private right of action.^[19] This final rule applies only to OCR's administrative enforcement of section 1557. As discussed in the 2022 NPRM, 87 FR 47838, we believe that other Federal agencies are better equipped to review and adjudicate employee health benefits and allegations of employment discrimination given their expertise under the existing employment nondiscrimination statutes they enforce.

Comment: Some commenters noted that employers are usually the sponsors of group health plans and raised concerns that OCR could therefor find an employer liable under section 1557 for the employee benefits it provides.

Response: This rule does not apply to employers or other plan sponsors with regard to their employment practices, including the provision of employee health benefits. As stated in the preamble to the Proposed Rule, 87 FR 47838, previous rules had limited application to employment. The 2016 Rule provided that employment practices included hiring, firing, promotions, or terms and conditions of employment, and therefore the 2016 Rule did not apply to those practices. However, the 2016 Rule applied to an employer with regard to its employee health benefit programs under certain circumstances as set forth under former § 92.208. The 2020 Rule, which repealed the 2016 Rule's reference to employment practices and employee health benefit programs, reverted to enforcing the statutorily referenced nondiscrimination statutes through their existing regulations. As discussed above, the Proposed Rule proposed to exclude employment practices, which included the provision of employee health benefit programs. OCR also recognizes that other sponsors of group health plans undertake similar employment practices, such as the provision of employee health benefits. For example, a joint board of trustees for a multi-employer group health plan (also known as a Taft-Hartley plan) consists of representatives from employers and unions to sponsor a group health plan, and similarly engages in the provision of an employee health benefit like employers that sponsor a single-employer plan. To ensure consistent application of the rule to entities engaging in similar employment functions, the final rule revises § 92.2(b) to provide that the rule does not apply to any employer or other plan sponsor of a group health plan, including but not limited to, a board of trustees (or similar body), association or other group, with regard to employment practices, including the provision of employee health benefits.

Group health plans, employers, and sponsors of group health plans are generally separate entities from one another that require a separate, fact-specific analysis to determine whether each entity is subject to this rule. We discuss the relationship between plan sponsors, such as employers, joint boards of trustees or similar bodies, associations, and other groups that are plan sponsors of multi-employer Taft-Hartley plans or multiple-employer welfare arrangements (MEWAs), and group health plans in more detail in the discussion of group health plans in the “health program or activity” definition discussion under § 92.4.

Comment: Some commenters stated that ongoing litigation surrounding section 1557 and previous iterations of OCR's section 1557 regulations, as well as agency course reversal on multiple occasions, has created confusion and compliance burden on covered entities. They urged the Department to reinforce the importance of severability under § 92.2(c) amongst the various regulatory provisions of the rule.

Response: We appreciate concerns around ongoing litigation and agency reversal, and the resulting inconsistency in requirements. OCR has attempted to answer questions and reduce confusion raised by the previous versions of the rule. While this final rule is similar to the 2016 Rule, it provides greater clarity regarding section 1557's statutory protections from discrimination along with various provisions to help alleviate burdens while providing certainty about covered entities' obligations when compared to the 2016 and 2020 Rules. We believe the final rule enhances the benefits to individuals and minimizes the burdens on covered entities.

OCR notes that § 92.2(c) provides that if any provision of this part is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, it shall be severable from this part and not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other, dissimilar circumstances. For example, if a court were to invalidate the final rule's Notice of availability of language assistance services provision (Notice of Availability) at § 92.11, all other provisions of the rule would remain in effect, as those provisions “could function sensibly without the stricken provision.” ^[20] Thus, if the rule's Notice of Availability provision were invalidated, OCR would not enforce that provision. Or, for example, if a court were to invalidate the final rule's Section 1557 Coordinator requirement at § 92.7, OCR would not require covered entities to fill this position as part of their compliance with this final rule, while otherwise enforcing other administrative requirements such as the Policies and procedures requirement at § 92.8 and the Notice of nondiscrimination requirement at § 92.10.

Comment: Some commenters requested that the final rule restore the 2016 Rule clarification that any age Start Printed Page 37530 distinctions exempt from the Age Act are also exempt from section 1557 enforcement.

Response: OCR appreciates commenters' request for clarity and directs commenters to § 92.101(b)(1) of this regulation, which adopts by reference the permissible uses of age located in the Department's Age Act regulations at 45 CFR part 91 (subpart B).

Comment: Some commenters argued that the Proposed Rule is inappropriate for the Indian Health Services (IHS) facilities because these are not open to members of the public but reserved for patients who are eligible beneficiaries as citizens of Tribal Nations, and as such, tribally operated IHS health facilities ^[21] should be exempt. These commenters stated that the 2022 NPRM failed to recognize the unique nature of the Indian Health Care System, which is the health care system for members of federally recognized Tribes in the United States. Commenters recommended that OCR acknowledge American Indian/Alaska Native (AI/AN) as a political classification, and not as a race-based classification. Commenters further opined that the 2022 NPRM failed to recognize the diplomatic, nation-to-nation relationship between Tribal Nations and the United States.

Response: OCR appreciates these comments. Similar concerns were raised during the 2022 NPRM Tribal Consultation held on August 31, 2022, pursuant to Executive Order 13175. The IHS, an agency within the Department, is responsible for providing health services to members of federally recognized tribes in 37 states, arising out of the special government-to-government relationship between the Federal Government and Indian tribes.^[22]

Membership or eligibility in a federally recognized tribal entity is a political classification rather than a racial classification.^[23] Preferences based upon the unique relationship between the United States and federally recognized tribal entities are distinct from the forms of discrimination prohibited by Federal civil rights laws, which aim to protect all individuals on the basis of race, color, or national origin (including AI/AN individuals, regardless of political affiliation).^[24] The Department's regulations implementing title VI provide that an individual shall not be deemed subjected to discrimination by reason of their exclusion from benefits limited by Federal law to individuals of a different race, color, or national origin. 45 CFR 80.3(d) (Indian Health and Cuban Refugee Services). IHS is mentioned in the Department's title VI regulation as an example of such a program. Id. In § 92.101(b), the final rule adopts this provision by reference, and OCR will fully apply it, as well as other applicable exemptions or defenses that may exist under Federal law.

Programs of the IHS are administered by IHS and tribes, including through self-determination contracts or self-governance compacts, and we intend to address any restrictions on application of the law to IHS programs in the context of individual complaints.

Comment: Some commenters requested that OCR develop an online tool that would help covered entities determine whether the final rule applies either directly or indirectly to an organization or other health program or activity.

Response: OCR provides various tools on our website to help covered entities determine their covered entity status and will continue to ascertain what tools would help the industry ensure widespread compliance. OCR notes that the Department's Office of Grants operates a website that tracks obligated Department grant funds, https://taggs.hhs.gov/​, which allows the public to identify recipients of Department funding.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.2, with modification. We are revising § 92.2(a)(3) to add the modifier “health” to “program or activity administered by a title I entity.” We are also revising § 92.2(b) to state that the provisions of this part shall not apply to any employer “or other a plan sponsor of a group health plan, including but not limited to, a board of trustees (or similar body), association or other group,” with regard to its employment practices, including the provision of employee health benefits.

Treatment of the Title IX Religious Exception

In the 2022 NPRM, OCR proposed to not import the title IX religious exception into the section 1557 regulation. The title IX statute states that the nondiscrimination requirements “shall not apply to an educational institution which is controlled by a religious organization” to the extent that such application “would not be consistent with the religious tenets of such organization.” 20 U.S.C. 1681(a)(3), as amended Public Law 100-259, section 3(b), Mar. 22, 1988, 102 Stat. 29. The title IX statutory definition of “program or activity” further limits the nondiscrimination requirements, in that they do not apply to “any operation of an entity which is controlled by a religious organization if the application of section 1681 of this title to such operation would not be consistent with the religious tenets of such organization.” Id. at 1687(4).

In the 2022 NPRM, we said that under the most natural understanding of section 1557's text, which bans discrimination “on the ground prohibited under . . . title IX,” the statutory term “ground prohibited” is best understood as incorporating only the bases on which discrimination is prohibited in the referenced statutes ( i.e., “sex” in title IX). 87 FR 47839. Rather than import the title IX exception for “educational institution[s]” that are controlled by “religious organization[s],” OCR proposed that the best way to address religious objections to the application of this rule—and the way most consistent with section 1557's statutory text and structure—would be through the process provided in proposed § 92.302. We sought comment on this approach. We particularly invited comments from covered entities controlled by or affiliated with religious organizations, providers employed by such entities, and people who receive health care from religiously affiliated medical providers.

The comments and our responses regarding this request for comment are set forth below.

Comment: Commenters provided mixed responses to OCR's proposal not to import the title IX religious exception into this rule. Many commenters supported OCR's statutory interpretation that section 1557 Start Printed Page 37531 incorporated the title IX statute only with respect to the ground of discrimination prohibited (sex) and its enforcement mechanisms ( e.g., termination of Federal financial assistance and other means authorized by law). Several commenters stated that this reading is most consistent with the statutory structure, because if Congress intended for the title IX religious exception to apply, the statute would also require the importation of the other title IX exceptions, many of which are by their terms plainly inapplicable in the context of health care.

Several commenters also stated that if Congress wanted to include the title IX religious exception, it could have either explicitly referenced or listed the exception in the section 1557 statutory text. Many commenters stated that any silence regarding the title IX exceptions was not an oversight by Congress, but an intentional decision. Many commenters contended that importing the title IX religious exception is contrary to the purpose of section 1557 and the goal of the ACA: to expand access to health care coverage. Additionally, many commenters said that importing the title IX religious exception is unnecessary given the numerous other Federal laws that allow religious organizations and providers to invoke a conscience or religious objection to providing certain kinds of medical services and care.

Many other commenters disagreed with OCR's interpretation, claiming that Congress intended to incorporate the entire title IX statutory scheme by including the signal “ et seq. ” Several commenters also argued that title IX's prohibition on sex discrimination cannot be read separate and apart from all the exceptions included in the title IX statute, in which Congress authorized certain conduct— i.e., otherwise prohibited sex discrimination. Accordingly, several commenters maintained that it is arbitrary and capricious for OCR to rely upon title IX's implementing regulations as a guide to prohibit discrimination on the basis of sex, such as those related to pregnancy-related conditions, or when distinguishing a marital, parental, and family status, while not importing the statute's religious exception.

A few commenters maintained that the differences between educational and health care institutions provide an unconvincing argument for nonimportation of the title IX religious exception because under the Title IX Common Rule of 2000 (Common Rule),^[25] title IX already applies to recipients of Federal financial assistance that provide health care. Many commenters also asserted that the court in Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016), found that the decision not to import the title IX religious exception into the 2016 Rule, without explanation, was contrary to law. Several commenters also pointed to that court's determination that the Department had previously “provide[d] that when cross-referencing the provisions of Title IX's use of `student,' the term `individual' should be used in the healthcare context.” Id. at 691. Commenters asserted that this finding by the court undermines the Department's claim that the title IX religious exception is specific to education and cannot be adopted more broadly in the health care context.

Response: Title IX applies to “any education program or activity” operated by recipients of Federal financial assistance, and the statute creates an exception from coverage for the education programs and activities of “an educational institution which is controlled by a religious organization if the application of [title IX's prohibition on sex discrimination in education programs and activities] would not be consistent with the religious tenets of such organization.” 20 U.S.C. 1681(a)(3). In addition, the Civil Rights Restoration Act of 1987 (CRRA) ^[26] statutorily defined “program or activity” for title IX to exclude from coverage “any operation of an entity which is controlled by a religious organization if the application of section 1681 of this title to such operation would not be consistent with the religious tenets of such organization.” 20 U.S.C. 1687(4). The preamble to the 2020 Rule stated that section 1557 “incorporates the statutory scope of Title IX, so it is appropriate for this rule to incorporate the Title IX statutory language concerning religious institutions.” 85 FR 37208.

OCR notes that as an initial matter, the CRRA's exclusion of any operation of religiously controlled entities from the application of title IX to the extent such operation is inconsistent with the religious tenets of the organization is not incorporated into section 1557. As we explain further in the discussion of “health program or activity,” section 1557 includes its own coverage provision that does not incorporate the CRRA's definitions of “program or activity.” Moreover, unlike title VI, section 504, and the Age Act,^[27] title IX modifies “program or activity” with “education,” 20 U.S.C. 1681(a), which limited title IX's prohibition on sex discrimination to the “education” context; the definitions of “program or activity” under title VI, section 504, or the Age Act do not include any comparable exclusion for the operations of religiously controlled entities.^[28] Thus, the CRRA's limitation to the application of certain operations of religious entities from title IX's coverage applies only in the “education” context and is not part of the definition of “program or activity” as that term is used in civil rights statutes more generally. Further, it is inapplicable to the definition of “health program or activity” adopted in section 1557. As a result, the sole question is whether the exclusion in title IX, 20 U.S.C. 1681(a)(3), of certain applications of the statute to “educational institution[s] which [are] controlled by a religious organization” carries over into section 1557.

Although title IX's prohibition of sex discrimination applies to some health-related activities of covered education programs—such as programs training future health workers—the range of exceptions provided in section 1681(a) are plainly tied to the educational setting ( e.g., the membership practices of social fraternities and sororities, YMCA, Girls Scouts, Boys Scouts; voluntary youth service organizations; father-son and mother-daughter activities; and beauty pageant-based scholarships, as well as educational admissions practices). All of these exceptions have little if any application to health programs and activities. Further, exceptions listed in that subsection include limitations regarding “educational institution[s],” “institution[s] of public higher education,” or “institution[s] of higher education.” 20 U.S.C. 1681(a)(1)-(9). Start Printed Page 37532

The language and subject matter of the exceptions suggest that Congress, in enacting title IX, did not intend those exceptions to define the statute's basis of discrimination—what section 1557 calls the “ground prohibited”—under title IX. Title IX prohibits discrimination on the basis of sex, so the “ground prohibited” under that statute is sex. Congress intended these exceptions to delineate certain contexts in which otherwise prohibited sex discrimination in the educational context would be excluded from the statute's coverage. Congress could have chosen to draft section 1557 to incorporate additional elements from title IX and the other referenced civil rights statutes ( e.g., those statutes' applicability provisions), but did not do so, instead narrowly specifying that only the “ground[s] prohibited” are incorporated.

OCR further notes that the inclusion of “ et seq. ” is simply part of an ordinary citation to the title IX statute. Congress frequently appends “ et seq. ” to statutory citations as a matter of course when legislation includes a generalized reference to a previously enacted statute.^[29] Including “ et seq. ” does not change the substantive meaning of section 1557, which incorporates only the grounds of prohibited discrimination and the enforcement mechanisms of each referenced statute. Further, section 1557 includes similar parenthetical citations with “ et seq. ” for the other referenced civil rights statutes in both 42 U.S.C. 18116(a) and (b). This underscores that Congress merely intended to provide the general, ordinary citation to the statutes being referenced, including title IX.

Section 1557's role as a health care statute further reinforces our reading of the statutory text and Congressional intent. Section 1557 was enacted as part of the ACA, in part, to expand access to health insurance and increase consumer protections. Title IX, as we have explained, relates specifically to education programs and activities. The title IX religious exception in that statute allows some entities to engage in certain conduct without requiring any consideration or mitigation of harm to third parties. If a similar standard were imported into this rule, it could undermine a key purpose of section 1557—ensuring access to health care. And as discussed below, unlike educational settings such as colleges and universities where there is more choice, individuals often have far fewer choices when accessing health care. In the federally funded health care context, the array of statutory conscience provisions enacted by Congress, as well as the general requirements of the First Amendment and the Religious Freedom Restoration Act (RFRA), provide a better fitting approach to addressing the relevant interests. This final rule has been revised to include regulatory text at § 92.3(c) recognizing that, insofar as the application of any rule requirement would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. Also, we have strengthened the process for raising religious freedom and conscience protections under this final rule at § 92.302.

The fact that title IX and agency implementing regulations apply to some health programs and activities—those that are part of educational programs and activities ^[30] —does not suggest that the exceptions set forth in the statute or implementing regulations apply to health programs and activities that are not a part of an educational program. Title IX's limitation to a recipient's education programs and activities has long been established.^[31] For example, the Common Rule (adopted by more than 20 Federal agencies) included the statute's limitation that the prohibition on sex discrimination applied only to the educational components of a covered entity's program.^[32] As we have explained, it is inconsistent with the text and purpose of section 1557, as well as the text and structure of title IX, to apply the title IX exceptions outside of the educational setting. Although the title IX regulations are relevant to informing what constitutes sex discrimination for purposes of this final rule—and we have looked to them for that purpose—that is because section 1557 incorporates the “ground prohibited” under title IX. But section 1557 does not incorporate any of the title IX exceptions. 87 FR 47839.

OCR disagrees with the Franciscan Alliance decision vacating portions of the 2016 Rule, and in any event, that decision does not prohibit OCR from not importing the title IX religious exception in this final rule. The promulgation of this final rule constitutes new rulemaking, and OCR has provided a detailed explanation for the decision to not import the title IX religious exception and has taken important steps to address religious freedom and conscience protections beyond those in the 2016 Rule. These steps include revisions at § 92.3(c) to recognizes that, “[i]nsofar as the application of any requirement under this part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required,” adoption of a voluntary assurance of exemption process based on these protections at § 92.302, and the Department's issuance of a final rule entitled Safeguarding the Rights of Conscience as Protected by Federal Statutes,89 FR 2078 (Jan. 11, 2024).

OCR notes that this final rule does not alter or eliminate a recipient's ability to maintain, seek, claim, or assert a title IX religious exception under title IX if it meets the applicable criteria.^[33] And to the extent the recipient is entitled to a religious exception under title IX, OCR's analysis will consider the entire statute, including title IX's specific limitation to the context of educational programs and activities.

Comment: Many commenters supported OCR's proposal not to import the title IX religious exception, highlighting what they characterized as the dangers of doing so in the context of health care and the potential consequences on people's access to health care it might have. For example, many commenters expressed concerns that providers would be able to deny essential health care services based on disapproval of a particular group, thereby putting at risk the health and well-being of already vulnerable individuals. Many commenters asserted that entities have invoked religious beliefs to deny individuals access to health care and coverage for a broad range of health care services. Commenters said that in urgent or emergency care situations, individuals may be unable to identify or use the services of an alternate provider when an institution withholds care based on religious tenets, even when the Start Printed Page 37533 individual is aware of such objections by an institution.

Many commenters highlighted the difference between education and health care. Multiple commenters stated that unlike certain health care settings, many parents have the choice to send their children to religious schools, whereas individuals often lack meaningful choices when seeking a health care provider, particularly for time-sensitive care. For example, numerous commenters stated that choice is especially limited in rural areas, and some patients may only have local access to religiously affiliated providers. Commenters worried that importing the title IX religious exception into this rule could have dire implications for health outcomes.

Response: As previously noted, this rule's application to the health care context is central to OCR's interpretation of section 1557. OCR appreciates that religiously affiliated hospitals and health care facilities play an important role in the health care system and recognizes the critical patient care needs they provide, including in underserved communities and areas which otherwise lack access to quality health care. At the same time, OCR believes that Congress chose not to import the title IX religious exception into section 1557 due to concerns about the impact such an action could have on access to health care. The importation of the title IX religious exception would raise unique concerns in the health care context that are not typically present in education programs and activities. As OCR discussed in the 2022 NPRM, health care settings differ from educational settings with respect to both the ability of affected parties to choose (or avoid) certain religiously affiliated health care institutions and the urgency of the need for services provided by the covered entities. 87 FR 47840. While students and families normally make a deliberate choice to attend a religious educational institution, in many cases specifically due to its religious character, individuals seeking health care are far more likely to be driven by other considerations such as availability, urgency, geography, insurance coverage, and other factors unrelated to whether the provider is controlled by or affiliated with a religious organization. See id. Rather than importing the title IX religious exception into section 1557, where Congress referenced only the “ground prohibited under” and the “enforcement mechanisms provided” for in title IX, the process set forth in § 92.302 respects religious freedom and conscience protections. As this final rule makes clear at § 92.3(c), insofar as the application of any requirement under this rule would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. Under § 92.302, recipients may rely on these protections or seek assurance of these protections from OCR, if they wish. In this process, OCR will comply with the applicable legal standards of the governing statutes, which include the protections in the ACA itself, 42 U.S.C. 18023; the Church, 42 U.S.C. 300a-7, Coats-Snowe, 42 U.S.C. 238n, and Weldon Amendments, e.g., Consolidated Appropriations Act, 2024, Public Law 118-47, div. H, tit. V, sec. 507(d)(1), 138 Stat. 460, 703 (Mar. 23, 2024); the generally applicable requirements of RFRA, 42 U.S.C. 2000bb-1; and other applicable Federal laws.

Comment: Many commenters who supported OCR's proposal not to import the title IX religious exception raised concerns that its importation could discourage individuals from seeking necessary medical care. Many commenters also discussed various State laws recently enacted to further expand religious exemptions from health care requirements and how such laws have specifically affected communities with limited access to care. These commenters argued that the effects of these laws further support OCR's goal of ensuring patients have broad access to nondiscrimination protections.

Response: OCR appreciates commenters' concerns regarding the potential harms to individuals with limited or restricted access to health care. OCR appreciates that many religiously affiliated hospitals and providers are providing vital services in areas where people are in the most need and are often motivated by their faith to provide this important care. However, OCR maintains that Congress did not choose to import the title IX religious exception into section 1557. Importing the title IX exception would be inconsistent with the text, structure, and purpose of both title IX and section 1557. Rather, Congress has enacted protections for conscience in the ACA itself; the Church, Coats-Snowe, and Weldon Amendments, among others; the generally applicable requirements of RFRA, and other applicable Federal laws as the means to protect religious freedom and conscience in this context. We are committed to affording full effect to Congress's protections of conscience and religion, as detailed in § 92.302 and the Department's issuance of its final rule, Safeguarding the Rights of Conscience as Protected by Federal Statutes. 89 FR 2078.

Comment: Multiple commenters opposed OCR's proposal not to import the title IX religious exception, stating that doing so would harm providers and hospital systems by compelling covered entities to provide abortion or other care that is contrary to their religious beliefs or that they believe will be harmful to their patients. Various commenters said that compelling such actions would turn many individuals and institutions of faith away from the medical profession.

Several commenters expressed confusion about available religious exceptions and how certain rule requirements would apply to religiously affiliated covered entities. These commenters said that including the title IX religious exception would clarify protections for religious entities.

Some commenters expressed concern that this regulation demonstrated OCR's intent to use section 1557 to force religious hospitals to dispense medication and perform procedures that are prohibited by their faith. Several commenters objected to the inclusion of cites in the 2022 NPRM that explain the increased prevalence of religiously affiliated health care systems and opined that this demonstrated hostility toward faith-based providers. According to these commenters, including these cites prejudices OCR's review of providers' religious exemption requests. Instead, these commenters urged OCR to make clear that providers will not be compelled to perform, cover, or promote procedures or medical interventions to which they have moral or religious objections.

Response: OCR appreciates commenters' concerns and respects their opposition to the proposal not to import the title IX religious exception. OCR reiterates, consistent with the 2022 NPRM, that this final rule does not promote any particular medical treatment, require provision of particular procedures, mandate coverage of any particular care, or set any standard of care; rather, the final rule implements the nondiscrimination requirements of section 1557. See87 FR 47867-68. The full protections of all Federal religious freedom and conscience laws continue to apply.

Additionally, OCR makes clear that the decision not to import the title IX religious exception does not compel any individual provider or covered entity with religious or conscience-based objections to provide abortion or any other care to the extent doing so would conflict with a sincerely-held belief. The ACA itself provides that “[n]othing in this Act shall be construed to have any Start Printed Page 37534 effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.” 42 U.S.C. 18023(c)(2)(A). As discussed further below, section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. A covered entity does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure. In addition, any recipient that believes that it is exempt from certain provisions of this rule due to the application of a Federal conscience or religious freedom law may rely on those provisions, as referenced in § 92.3(c), or choose to seek assurance of the applications of those provisions pursuant to the process provided in § 92.302.

In light of § 92.302 and 42 U.S.C. 18023(c)(2)(A) (section 1303 of the ACA), OCR maintains that although some recipient providers and hospitals may decline to participate in federally funded health programs as a result of this rule, most will choose to continue to participate. To avoid confusion, we have further clarified the process for seeking assurance of an exemption based on religious freedom and conscience laws at § 92.302 and are committed to making available trainings and other resources to assist covered entities in understanding their obligations under section 1557 and the process by which they may seek assurance of an exemption under § 92.302.

Again, OCR appreciates that religiously affiliated hospitals and health care facilities play an important role in the health care system and recognizes the critical patient care needs they provide, including in underserved communities and areas which otherwise lack access to quality health care. Any discussion relating to the prevalence of religiously affiliated care is relevant for OCR to evaluate access issues that patients seeking certain procedures or care could potentially face, although OCR does not assume that all religiously affiliated entities' refusals to provide certain forms of care would result in such access issues. As previously stated, the 2022 NPRM provided factual findings with respect to health care accessibility in the United States based upon health care capacity of providers, population demands, and geographic limitations. 87 FR 47840. A detailed discussion of these considerations can be found in the Regulatory Impact Analysis (RIA).

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, OCR is finalizing the rule as proposed, without importing the title IX religious exception.

Relationship to Other Laws (§ 92.3)

In § 92.3, we provided an explanation of the relationship of the proposed regulation to existing laws. Proposed § 92.3(a) provided that neither section 1557 nor this part shall be interpreted to apply lesser standards for the protection of individuals from discrimination than the standards under title VI, title IX, section 504, the Age Act, or the regulations issued pursuant to those laws.

In § 92.3(b), we proposed that nothing in this part shall be interpreted to invalidate or limit the existing rights, remedies, procedures, or legal standards available under the Federal civil rights laws cited in 42 U.S.C. 18116(b) (title VI, title VII, title IX, section 504, and the Age Act), consistent with 42 U.S.C. 18116(b).

In § 92.3(c), we proposed that nothing in this part shall be interpreted to invalidate or limit the existing rights, remedies, procedures, or legal standards available under Federal religious freedom and conscience laws. Though not specifically referenced in the Proposed Rule, these include the protections in the ACA itself; the Church, Coats-Snowe, and Weldon Amendments; the generally applicable requirements of RFRA; and other applicable Federal laws.

The comments and our responses to this provision are set forth below.

Comment: Commenters expressed a mix of viewpoints regarding the “lesser standard” language included in proposed § 92.3(a), concerning civil rights statutes referenced in section 1557. Some commenters recommended removing the “lesser standard” language because it is not included in the section 1557 statute. Commenters stated that this language ignores Congress's decision to employ a particular standard to each of the civil rights laws incorporated, such that it would allow OCR to redefine bases for discrimination and improperly preempt State law affecting such categories.

Response: In this final rule, OCR seeks to give all laws their fullest possible effect. OCR appreciates these comments but declines to remove the “lesser standard” language included in § 92.3(a). As the 2016 Rule recognized, 81 FR 31381, this interpretation is consistent with a natural reading of section 1557's statutory text that explicitly states that section 1557 shall not be construed to “invalidate or limit the rights, remedies, procedures, or legal standards” of the referenced statutes (and title VII) “or to supersede State laws that provide additional protections against discrimination,” 42 U.S.C. 18116(b). OCR accordingly reaffirms that the civil rights laws referenced in section 1557 establish the grounds of prohibited discrimination, and nothing in this final rule is intended to provide lesser protections than those found under title VI, title IX, section 504, or the Age Act, or their implementing regulations.

Comment: Several commenters supported the inclusion of the “lesser standard” language in § 92.3(a) but suggested that § 92.3(c), concerning Federal religious freedom and conscience laws, is unnecessary and, if included without any limitations, undermines this “lesser standard” language of § 92.3(a) and could encourage discrimination.

Response: We decline to remove § 92.3(c), concerning Federal religious freedom and conscience laws. These laws remain applicable and removing the language runs contrary to the Department and OCR's stated commitment to protect the rights of individuals and entities under Federal conscience or religion freedom laws. Indeed, the ACA itself contains a similar provision at 42 U.S.C. 18023(c)(2)(A)(i), which provides that “[n]othing in this Act shall be construed to have any effect on Federal laws regarding—conscience protection[.]” As discussed later in this section, we have revised § 92.3(c) to provide additional specificity regarding the application of Federal religious freedom and conscience protections.

Comment: Some commenters suggested that OCR clarify that section 1557 does not limit the rights of individuals to any of the protections afforded under title VI, title IX, section 504, or the Age Act. These commenters suggested that section 1557 is a distinct law and, while it is intended to work in tandem with other civil rights laws, section 1557 stands on its own. Several other commenters requested that the final rule include language that clarifies that administrative exhaustion is not required to bring any claim under section 1557 in Federal court, where for example a claim may involve age as one basis of discrimination among several ( e.g., alleging discrimination on the bases of age, sex, and disability at the same time) but the Age Act has a Start Printed Page 37535 statutory requirement that claimants first exhaust their administrative remedies.

Response: Section 92.3(b) clearly states that this part does not limit or invalidate the rights, remedies, procedures, or legal standards under the statutes referenced ( i.e., title VI, title VII, title IX, section 504, and the Age Act), consistent with the statutory text of section 1557 at 42 U.S.C. 18116(b). In addition to incorporating the “ground[s] prohibited” by these other statutes, section 1557 incorporates the “enforcement mechanisms” of the statutes. 42 U.S.C. 18116(a). Though the section 1557 rule is informed by the title VI, title IX, Age Act, and section 504 implementing regulations, section 1557 provides an independent basis for regulation of discrimination in covered health programs and activities that is distinct from these statutes. Section 1557's nondiscrimination requirements do not in any way limit or impact the interpretation of those statutes. See id. at 18116(b). Section 1557 is a distinct civil rights authority.

Courts have long recognized that section 1557 authorizes a private right of action under any of the bases for discrimination. While we appreciate concerns raised by commenters regarding the heightened risks associated with unnecessary delays in the context of health care, we decline to revise regulatory text to adopt a stance on the appropriate standards that apply to private litigants. This is an issue appropriately addressed by the Federal judicial branch and not via agency rulemaking. Comments and responses regarding OCR procedures for conducting its own administrative enforcement are provided in §§ 92.303 (Procedures for health programs and activities conducted by recipients and State Exchanges) and 92.304 (Procedures for health programs and activities administered by the Department).

Comment: Many commenters raised concerns about the potential conflicts of State and Federal laws. Some commenters expressed that any conflict between State and Federal law or policy would be inconsistent with the principles of federalism. Some commenters had specific concerns regarding the final rule's application to State laws that prohibit transgender patients from receiving certain medically necessary gender-affirming care or those that protect religious freedom and conscience. Other commenters suggested that OCR should include a subsection in the final rule that addresses the interaction between section 1557 and State or local laws, making explicit that a State may set more rigorous standards for nondiscrimination in the provision of health care but not lesser protections than those of section 1557. To the extent State or local law offers lesser protections these commenters recommended OCR make explicit that such laws are preempted by Federal law, consistent with the general preemption standard for title I of the ACA, codified at 42 U.S.C. 18041(d).

Response: OCR appreciates these comments regarding the rule's interaction with State and other Federal laws. We agree with commenters who observed that Federal laws, as a general matter, preempt conflicting State laws. See U.S. Const. art. 6, cl. 2. We also note that title I of the ACA itself contains a preemption provision, which courts have interpreted to preempt State laws that serve as an obstacle to or frustrate the purpose of the ACA. ³⁴ See42 U.S.C. 18041(d). Accordingly, we decline to alter the regulation to include any additional language under this provision addressing preemption. OCR recognizes that some States may have laws impacting health programs and activities that are contrary to the final rule's nondiscrimination protections, and as discussed later regarding § 92.206 (Equal program access on the basis of sex), section 1557 preempts those laws, though OCR will consider the specific facts of each case and any other relevant factors in determining whether the recipient has a legitimate, nondiscriminatory reason for taking actions that conflict with section 1557. OCR is adding § 92.3(d) regarding State and local laws to provide: “Nothing in this part shall be construed to supersede State or local laws that provide additional protections against discrimination on any basis described in § 92.1.”

Comment: Commenters recommended that OCR include in the final rule clarification that the Emergency Medical Treatment and Labor Act (EMTALA) protects emergency care for pregnancy and related conditions, including termination of pregnancy.

Response: This rule concerns section 1557 and does not purport to interpret or enforce EMTALA—indeed, OCR does not enforce EMTALA, nor does EMTALA limit or expand the civil rights protections found in section 1557.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.3, with modifications. We are revising § 92.3(c) to provide that, insofar as the application of any requirement under the part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. For example, 42 U.S.C. 18023 provides (among other things) that, nothing in section 1557 shall be construed to have any effect on Federal laws regarding conscience protection; willingness or refusal to provide abortion; and discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion. We are also adding a new § 92.3(d) to provide that nothing in the part shall be construed to supersede State or local laws that provide additional protections against discrimination on any basis described in § 92.1.

Definitions (§ 92.4)

In § 92.4 of the Proposed Rule, we set out proposed definitions of various terms. The comments and our responses regarding § 92.4 are set forth below.

Auxiliary aids and services. The term auxiliary aids and services was defined in the 2016 Rule and has not been changed substantively. The proposed definition is consistent with the Americans with Disabilities Act (ADA) regulations at 28 CFR 35.104 and 36.303(b) and provides examples of auxiliary aids and services.

Comment: Commenters generally supported the definition of “auxiliary aids and services.” Some commenters recommended that the final rule clarify that “similar services and actions” are available for all individuals with disabilities, not just for individuals who are deaf or hard of hearing and individuals who are blind or have low vision.

Response: OCR appreciates this comment; however, effective communication requirements are addressed in § 92.202(a). As § 92.4 is simply providing a definition for the term auxiliary aids and services, which is used in § 92.202(b), we do not believe Start Printed Page 37536 it is appropriate to adopt language suggested by the commenters.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “auxiliary aids and services” as proposed in § 92.4, with one technical correction in paragraph (1) to provide the correct cite for the title II definition of “qualified interpreter” by striking “36.303(b)” and replacing it with “36.104.”

Companion. We proposed to define the “companion” to mean “family member, friend, or associate of an individual seeking access to a service, program, or activity of a covered entity, who along with such individual, is an appropriate person with whom a covered entity should communicate.” This term appeared in the 2016 Rule and has not been changed substantively.

Comment: Many commenters support the inclusion of the term “companion” in the definitions section of the regulation, and some highlighted that companions for persons with certain disabilities, such as brain injuries and other conditions with cognitive effects, as well as individuals with sensory disabilities, are critical to effective communication of very sensitive and important medical information. Some commenters suggested that OCR clarify that such companions should be selected by the patient and not the provider.

Response: OCR appreciates the commenters' support for inclusion of this definition. OCR declines to add additional language, as the definition of “companion” in this rule is consistent with the definition from 28 CFR 35.160(a)(2) under title II of the ADA, and with the proposed definition in OCR's notice of proposed rulemaking for section 504 at proposed 45 CFR 84.10.^[35] We agree that the individual with a disability should be the one to determine who shall serve as their companion absent any concerns of conflict of interest or suspected abuse.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “companion” as proposed in § 92.4, without modification.

Federal financial assistance. We proposed to define the term “Federal financial assistance” to include grants, loans, and other types of assistance from the Federal Government, consistent with the definition of the term in the section 504 and the Age Act implementing regulations at 45 CFR 84.3(h) and 91.4, respectively. We also proposed to specifically include credits, subsidies, and contracts of insurance, in accordance with the statutory language of section 1557. 42 U.S.C. 18116(a). Consistent with the 2016 Rule, we proposed including a clause to clarify that Federal financial assistance includes Federal financial assistance that the Department plays a role in providing or administering.

Comment: Many commenters supported the inclusion of credits, subsidies, contracts of insurance, and grants and loans in this definition. Some commenters recommended expanding the definition of “Federal financial assistance” to include Federal disaster relief loans and pandemic relief grants and loans.

Response: The definition of “Federal financial assistance” includes funds provided by the Federal Government, including grants and loans, along with Federal financial assistance that the Department plays a role in providing or administering. Because the types of funds raised by the commenters already fall under the longstanding definition of “Federal financial assistance,” and the inclusion of specific types of Federal financial assistance would cause unnecessary confusion and may be read as unintentionally limiting the scope of what constitutes Federal financial assistance, we decline to revise the definition.

Comment: Some commenters requested that OCR clarify whether tax-exempt status is considered Federal financial assistance.

Response: OCR appreciates commenters' request for clarity. Generally, tax benefits, tax exemptions, tax deductions, and most tax credits are not included in the statutory or regulatory definitions of Federal financial assistance. See, e.g.,42 U.S.C. 2000d-1 (title VI); 28 CFR. 42.102(c) (Department of Justice Title VI Regulation). Most courts that have considered the issue have concluded that typical tax benefits are not Federal financial assistance because they are not contractual in nature.^[36]

Comment: Many commenters supported the definition's inclusion of Federal financial assistance that “the Department plays a role in providing or administering, including advance payments of the premium tax credit and cost-sharing reduction payments.” ^[37] A commenter expressed support for this definition's application to funds extended via programs operated by States under section 1332 State Innovation Waivers, 42 U.S.C. 18052, which could include funds extended to issuers receiving reimbursement through reinsurance programs and entities participating in programs intended to modify or replace Exchanges that would otherwise be within the scope of section 1557.

Response: OCR appreciates these comments and believes it is important to explicitly state in regulatory text that funds that the Department plays a role in providing or administering constitute Federal financial assistance. As explained in the Proposed Rule, 87 FR 47843, this includes funds the Department administers with the Department of the Treasury under the ACA, including advance payments of the premium tax credit, cost-sharing reductions,^[38] and pass-through funding available to States with approved section 1332 waivers. Thus, an issuer participating in any Exchange that receives advance payments of the premium tax credit or cost-sharing reductions on behalf of any of its enrollees is receiving Federal financial assistance from the Department.

Section 1332 of the ACA permits a State to apply for a section 1332 waiver to pursue innovative strategies for providing residents with access to high quality, affordable health insurance while retaining the basic protections of the ACA. Section 1332 waiver funds constitute Federal financial assistance and States receiving such funds are recipients. As discussed in the 2022 NPRM, section 1332 allows States to apply to HHS and the Department of the Treasury to waive certain ACA requirements in the individual and small group markets if the waiver satisfies certain statutory Start Printed Page 37537 requirements.^[39] 87 FR 47843. For example, under this provision, several States have utilized section 1332 waivers to introduce new or expanded plan options to consumers that lower premiums and/or expand access to coverage, or implemented reinsurance programs to lower premiums and stabilize the individual or small group market by compensating issuers for eligible high-cost claims for enrollees with significant medical costs. These State reinsurance programs use section 1332 pass-through funding to reimburse eligible issuers for high-cost enrollees. These States establish reimbursement eligibility criteria for issuers under the State's reinsurance program, which may include payments to issuers offering coverage both on and off the Exchange. Health insurance issuers receiving payments through a State's section 1332 waiver reinsurance program are subrecipients and therefore subject to section 1557. To the extent a State's waiver utilizes pass-through funding for provider reimbursement those providers would also be subrecipients and subject to section 1557; however pass-through funding received by individual consumers would not be subject to section 1557.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “Federal financial assistance” as proposed in § 92.4, without modification.

Health program or activity. OCR proposed to adopt a definition of “health program or activity.” In paragraph (1), we proposed defining health program or activity to mean any project, enterprise, venture, or undertaking to provide or administer health-related services, health insurance coverage, or other health-related coverage; provide assistance to persons in obtaining health-related services, health insurance coverage, or other health-related coverage; provide clinical, pharmaceutical, or medical care; engage in health research; or provide health education for health care professionals or others.

In paragraph (2), we proposed further defining “health program or activity” to include all of the operations of any entity principally engaged in the provision or administration of health projects, enterprises, ventures, or undertakings described in paragraph (1) (“principally engaged”). We proposed that whether such entities are administered by a government or a private entity, all of their operations would be covered under this part.^[40] We also invited comment on the circumstances under which a group health plan might receive funds that could be considered Federal financial assistance from the Department, including the type and prevalence of funds received that could be considered Federal financial assistance under this part.

Comment: Commenters expressed a variety of views regarding the application of the rule to health insurance issuers as health programs or activities and the rule's application to all their operations when principally engaged in any project, enterprise, venture, or undertaking to provide or administer health-related services, health insurance coverage, or other health-related coverage, as set forth under paragraph (2) of the definition of “health program or activity.”

Many commenters supported the inclusion of health insurance issuers and coverage of all their operations when so principally engaged. These commenters argued the 2020 Rule's approach, which applies to health insurance issuers only to the extent a specific plan receives Federal financial assistance, is contrary to the text of section 1557, the CRRA, and the broad remedial intent of Congress in enacting the ACA to ensure access to health insurance. Specifically, commenters argued the 2020 Rule is arbitrary and contrary to the plain language of section 1557, which applies to “any health program or activity, any part of which is receiving Federal financial assistance ” (emphasis added) and specifically includes three examples of Federal financial assistance that refer to health insurance (“credits, subsidies, or contracts of insurance”). 42 U.S.C. 18116(a). This statutory language, commenters argued, affirms that Congress intended section 1557 to apply to the entire health program or activity, not just the parts that directly receive Federal financial assistance. Commenters noted that the statutory text should be construed broadly and stated that the Proposed Rule's application to health insurance will align with the application to all operations of other covered entities.

Many commenters raised objections to the 2020 Rule's provision at § 92.3(b) that covers all operations of an entity only when principally engaged “in the business of providing healthcare ” (emphasis added), in combination with § 92.3(c) that specified a health insurance issuer was not considered to be principally engaged in the business of providing health care merely by virtue of providing health insurance, which resulted in the 2020 Rule not covering all operations of a recipient health insurance issuer. Commenters stated this approach was inconsistent with Congress's approach in the CRRA, which supports an expansive interpretation of section 1557's application to cover all operations of a recipient if any part of it receives Federal financial assistance. Specifically, one commenter asserted that the section 1557 statute's use of the CRRA language “program or activity” and “any part of which,” coupled with the statute's reference to title VI, title IX, section 504, and the Age Act, demonstrate Congress's intent to adopt the same broad application for section 1557. Commenters also argued the 2020 Rule's approach is inconsistent with the text of section 1557, which broadly applies to health programs or activities and is not limited to the delivery of health care. Commenters challenged the 2020 Rule's contention that health insurance is not health care, arguing that health insurance issuers are in fact engaged in the business of health care and that other parts of the ACA support this position. For example, “health care entity” is defined to include “a health insurance plan” under 42 U.S.C. 18113(b) and 42 U.S.C. 300gg-91(b)(1) defines “health insurance coverage” to mean benefits consisting of medical care.” Among other things, commenters cited to section 1551 of the ACA, 42 U.S.C. 18111, which specifies that, unless otherwise indicated, the definitions in 42 U.S.C. 300gg-91 apply to title I of the ACA.

Conversely, other commenters urged the Department to retain the 2020 Rule's approach, asserting that the CRRA limits the scope of section 1557 with regard to all operations of a program or activity to only those that are “principally engaged in the business of providing . . . healthcare ” (emphasis added).

Others argued that the Proposed Rule's application to health insurance is Start Printed Page 37538 too broad and should not apply to all operations of a health insurance issuer, particularly its lines of business that do not receive Federal financial assistance. Specifically, commenters noted that because health insurance issuers participate in some types of health insurance that receive Federal financial assistance and other types that do not, the Proposed Rule would require compliance even in activities that do not benefit from Federal financial assistance. Commenters opined that this interpretation goes beyond the scope of Congressional intent, where Congress did not apply the protections to any entity engaging in health programs and activities, but only to those health programs and activities that specifically receive Federal financial assistance. One organization asserted that the Proposed Rule could result in health insurance issuers incurring substantial costs and declining to participate in or withdrawing from the Exchanges, the Medicaid managed care market, or the Medicare Advantage market, resulting in reduced coverage options in those markets.

Response: In re-evaluating the 2020 Rule's interpretation of “health program or activity” as it relates to health insurance and in deciding to add a definition of “health program or activity,” OCR considered a number of factors, including the plain language of section 1557, the context of its placement within the ACA, long-standing civil rights principles, and relevant case law.

The 2020 Rule does not include a definition of “health program or activity,” but rather addresses the term under § 92.3, the scope of application section. The 2020 Rule provides that “health program or activity” encompasses “all of the operations of entities principally engaged in the business of providing healthcare ” (emphasis added) and specifies that a health insurance issuer is not considered to be principally engaged in the business of providing health care merely by virtue of providing health insurance. 45 CFR 92.3. The 2020 Rule further provides that for entities not principally engaged in the business of providing health care, their operations are only covered under the rule to the extent such operation is a health program or activity that receives Federal financial assistance. 45 CFR 92.3(b). Thus, the 2020 Rule limits OCR's jurisdiction over health insurance issuers to only their plans that directly receive Federal financial assistance. This is in contrast to the 2016 Rule, which defined “health program or activity” to include all the operations of entities principally engaged in health services, health insurance coverage, or other health-related coverage, including health insurance issuers, at former 45 CFR 92.4.

OCR agrees with commenters' assessment that the Proposed Rule's approach to the inclusion of health insurance coverage and other health-related coverage in the definition of “health program or activity” is most consistent with section 1557's statutory text and Congressional intent. The statutory text demonstrates Congress's clear intent to apply section 1557 to health insurance coverage and other health-related coverage. This statutory text does not support the 2020 Rule's limiting “health program or activity” to encompass all of the operations of only those entities principally engaged in the business of providing “healthcare.” Under the plain language of the statute, section 1557 applies to any “health” program or activity not “healthcare” program or activity. And the provision of health insurance coverage and other health-related coverage is plainly classified under the term “health.” Private health insurance issuers exercise significant control over enrollees' access to health care and play a critical role in the business of health care, as insurance is an essential component of ensuring that people receive care in the current health care system. For example, a district court opinion on this issue held that a health insurance issuer, by virtue of being the “gatekeeper” to the plaintiff's health services, qualified as a “ `health program' that Congress intended to rid of discrimination.” ^[41]

Further, as we discussed in the Proposed Rule, 87 FR 47845, the fact that Congress placed section 1557 in title I of the ACA, a title that predominantly regulates health insurance coverage and other health-related coverage with the purpose of increasing access to care and reducing discriminatory insurance practices, demonstrates Congress's intent for section 1557 to protect individuals from discrimination in health insurance coverage and other health-related coverage.

While not dispositive, we do appreciate commenters' thoughts on whether health insurance issuers are in fact engaged in the business of providing health care. Commenters among other things, cited to section 1551 of the ACA, which specifies that, unless otherwise indicated, the definitions in 42 U.S.C. 300gg-91 shall apply with respect to title I of the ACA. Section 300gg-91(b)(1) defines the term “health insurance coverage” as “benefits consisting of medical care (provided directly, through insurance or reimbursement, or otherwise and including items and services paid for as medical care) . . . .” (Emphasis added.) The 2020 Rule specifies that “medical care” as used in that provision is limited to the “amounts paid for” certain medical services and that a health insurance issuer is not considered to be principally engaged in the business of providing health care merely by virtue of providing health insurance. However, the text of section 1557 does not support the 2020 Rule's position that the rule applies only to the business of providing “healthcare.”

OCR found commenters' concerns regarding the negative consequences that could result from the Proposed Rule's scope of application to insurance issuers unpersuasive given the lack of information provided to substantiate their concerns. For example, one commenter cited to Exchange participation statistics that indicated certain issuers have limited or no Exchange participation.^[42] However, the statistics do not demonstrate the reason for such issuers' lack of participation or provide evidence that an issuer's decision not to participate in an Exchange was due to apprehension that section 1557 would apply to its activities that did not receive Federal financial assistance.

The application of civil rights laws to all operations of an entity receiving Federal financial assistance is not new and did not originate with section 1557. For more than 35 years, under the CRRA, a recipient of Federal financial assistance that accepts Federal funds in any part of its program has been required to comply with title VI, section 504, and the Age Act in “all of the[ir] operations.” ^[43] The CRRA specifies that the entire program or activity, as defined in that statute, is required to comply with title VI, section 504, and the Age Act if any part of the program or activity receives Federal financial Start Printed Page 37539 assistance. We note that the terms “program” and “program or activity” predate the CRRA in the underlying civil rights statutes, and the legislative history of the CRRA indicates that Congress did not believe it was enacting a new definition, but rather overturning an overly narrow construction of the term by the Supreme Court and thereby restoring what Congress and the executive branch had previously understood to be a broad, institution-wide application of the term “program.” See S. Rep. No. 100-64 (1987). OCR maintains that Congress adopted a similar approach in section 1557 by specifying in the statute that section 1557 applies when “any part of” the health program or activity receives Federal financial assistance.^[44] Entities must comply with civil rights laws just as they must comply with any other State or Federal law that is applicable to their operations.

The 2020 Rule states it was applying the CRRA's definition of “program or activity” to cover all operations of entities under section 1557 only when they are “principally engaged in the business of providing healthcare.” We received some comments in support of the approach in that rulemaking, and while we appreciate the importance of the CRRA in shaping the interpretation of the scope of Federal civil rights protections under title VI, section 504, title IX, and the Age Act, it is not applicable here. Section 1557 employs the term “program or activity” without adopting by reference the CRRA or any of the underlying civil rights statutes. The 2020 Rule erred in applying the CRRA to narrow the application of section 1557 by excluding a significant portion of the health insurance industry. If Congress had intended to limit section 1557 to entities principally engaged in the business of providing “healthcare,” it could have provided as such in the statute. Instead, the statute expressly modified “program or activity” with “health,” without requiring that that entity be “principally engaged in the business of providing healthcare.”

While Congress did not incorporate the CRRA into section 1557 wholesale, it stated that section 1557 applies to “any health program or activity, any part of which is receiving Federal financial assistance.” 42 U.S.C. 18116(a) (emphasis added). By modifying “program or activity” with “health,” and noting a health programs or activity is covered if “any part” of it receives Federal financial assistance, it is reasonable to infer that Congress intended the term “health program or activity” to be interpreted broadly and to include all of that entity's operations, if the entity that receives Federal funding is principally engaged in the provision or administration of health insurance coverage or other health-related coverage. And because “health program and activity” is undefined in the section 1557 statute, it is also reasonable to infer that those health programs or activities include health-related services, health insurance coverage, or other health-related coverage.

Comment: One commenter argued that, because the CRRA delineates the scope of coverage of section 1557's underlying civil rights statutes, failing to include this limitation in the final rule would expand the notion of Federal financial assistance to ultimate beneficiaries of the funding and would have significant effect on other civil rights laws dealing with funding, including title VI, title IX, and others.

Response: The commenter's concerns regarding interference with the longstanding principle that Federal civil rights laws do not apply to direct, unconditional assistance to ultimate beneficiaries are unsupported. Ultimate beneficiaries are the intended class of private individuals receiving Federal aid,^[45] a concept that is not impacted or modified under this rulemaking. In fact, the definition of “recipient” in the final rule at § 92.4 adopts standard language that explicitly states that the term “does not include any ultimate beneficiary.”

Comment: OCR received comments specifically related to the rule's application to health insurance issuers' other products and lines of business that do not receive Federal financial assistance, such as health insurance coverage sold off the Exchange, excepted benefits, short-term, limited-duration insurance, and third party administrator activities.

Response: These comments are addressed in the Scope of Application discussion under § 92.207 (Nondiscrimination in health insurance coverage and other health-related coverage).

Comment: Some commenters, including an association representing State insurance regulators, critiqued OCR's “fungibility of funds” rationale for including all operations of recipients that are principally engaged in the provision or administration of health insurance coverage. These commenters argued it is inappropriate to consider funding to be fully fungible in the context of health insurance, where issuers justify their premiums based on expected costs in a particular market, not across all operations, and thus Federal financial assistance for one type of coverage does not actuarially support or subsidize an issuer's operations in other markets. Commenters noted that entities have a myriad of corporate structures, and that Federal funds received by one legal entity might not be shared with sibling entities in unrelated business ventures. Commenters pointed to the 2016 Rule's analysis regarding liability of third party administrators, where OCR discussed that a third party administrator that is legally separate from an issuer is unlikely to be covered under the rule. 81 FR 31433.

Conversely, other commenters agreed with OCR's fungibility of funds rationale, and argued that Federal financial assistance going to any part of a health program or activity necessarily benefits the entity receiving such funds as a whole. These commenters noted that a narrower construction, in which nondiscrimination rules apply only to part of a recipient, makes it easier for discriminatory actors to structure their operations to evade responsibility and frustrates the purpose of the statute.

Response: As commenters noted, OCR discussed the fungibility of funds rationale as one means of support for the interpretation that all of a health insurance issuer's operations will be covered by the final rule when the health insurance issuer receives Federal financial assistance. See87 FR 47844. However, we note that reliance on this rationale is not necessary to support OCR's interpretation that this final rule applies to all of the operations of a recipient that is “principally engaged,” as discussed above. Under the best reading of the statutory text, where an entity receives Federal financial assistance and that entity is “principally engaged in the provision or administration of any health projects, enterprises, ventures, or undertakings described in paragraph (1)” of the definition of “health program or activity,” the whole entity is defined as a health program or activity covered under section 1557 and must comply with the final rule.

We acknowledge that covered entities may structure their businesses in a variety of ways. Unless an entity that is principally engaged can demonstrate that part of their operations is truly a separate legal entity, as discussed below, a recipient that is principally engaged is liable for all its operations under the final rule. Start Printed Page 37540

Comment: One organization recommended that OCR explicitly identify patient billing and collections activities as “health programs or activities” by amending the definition to add a new paragraph (1)(vi) as follows: “provide or administer billing and collections services for health-related services, including providing assistance to persons to obtain financial help or counseling.”

Response: This final rule, consistent with OCR's other civil rights implementing regulations, prohibits covered entities—directly or through contractual or other arrangements—from discriminating in patient billing and collection activities related to health programs and activities. For example, a hospital's in-house administration of billing would be covered and any contractual arrangement for collections of debt would also be covered. We decline to add the recommended language because it is unnecessary.

Comment: Many commenters strongly supported the Proposed Rule's explicit inclusion of health research in the definition of “health program or activity.” Some commenters recommended updating paragraph (1)(iv) to include “clinical” research for clarity and to update paragraph (2) to include: “clinical trial sites including wherever potential clinical trial participants are screened or recruited” in the list of entities considered “principally engaged.” In addition, other commenters recommended that OCR provide technical guidance in what “inclusion” in clinical research looks like and how it can be achieved through nondiscriminatory research protocols.

Response: OCR supports the request to include clinical research in the definition of “health program and activity,” and have revised paragraph (1)(iv) accordingly. Clinical research is the comprehensive study of the safety and effectiveness of the most promising advances in patient care, and is different from laboratory research as it involves people who volunteer to help the field better understand medicine and health.^[46] However, we decline to add reference to physical sites, as the jurisdiction applies to the health program or activity regardless of where it takes place and whether it can be said to take place at a site at all. For example, if a hospital receives a grant from the National Institutes of Health to conduct a clinical study on the effects of Tuberous Sclerosis Complex, the hospital is prohibited from discriminating in its screening and recruitment activities wherever they take place, such as at the hospital itself, at community health fairs, online, or at the home of a hospital researcher who is working out of their own home.

Comment: One organizational commenter requested that OCR clarify section 1557's application to health research projects and activities to explicitly recognize that health research is conducted to answer specific questions, and that research protocols may target or exclude certain populations where nondiscriminatory justifications show that such criteria are appropriate, consistent with the 2016 Rule preamble.

Response: Consistent with the 2016 Rule, OCR does not intend the inclusion of health or clinical research within the definition of “health program or activity” to alter the fundamental nature in which research projects are designed, conducted, or funded. 81 FR 31385. As in the 2016 Rule, we note that criteria in research protocols that target or exclude certain populations are warranted where nondiscriminatory justifications establish that such criteria are appropriate with respect to the health or safety of the subjects, the scientific study design, or the purpose of the research. See81 FR 31385.

Comment: Some commenters recommended that OCR narrow the definition of “health program or activity” to exclude programs and activities unrelated to health. These commenters also requested that OCR clarify what “any project, enterprise, venture or undertaking to provide or administer health-related services” means. For example, these commenters were unclear whether a health-related venture may include such things as vitamin manufacturing.

Response: The final rule applies to health programs and activities that receive Federal financial assistance from the Department (or that are administered by the Department or a title I entity) and does not apply generally to programs and activities that are unrelated to health. However, where an entity is principally engaged as set forth in paragraph (2) of the definition of “health program or activity,” all operations of the covered entity must comply with the final rule. This applies even where the covered entities' other operations are not necessarily health-related.

Though not an exhaustive list, “health-related service” would include the provision of medical, dental, and pharmaceutical care; preventive health services; physical, occupational, or speech therapy; behavioral health care; clinical trials; and transportation to and from such services when necessary to facilitate access to other health-related services.^[47] Should an entity engaged in commercial vitamin manufacturing receive Federal financial assistance from the Department, OCR would conduct an analysis as to whether the program or activity in question meets the definition of “health program or activity.”

Comment: A few commenters urged the Department to expressly list Medicaid programs, Children's Health Insurance Program (CHIP), or the Basic Health Program in its definition for “health program or activity.”

Response: The 2016 Rule included Medicaid programs, CHIP and the Basic Health Program in its definition of “health program or activity” at former 45 CFR 92.4. As stated in the preamble to the 2022 NPRM, these entities would be covered in their entirety as operations of State or local health agencies and we sought comment on whether such programs should be explicitly referenced in the regulatory language. 87 FR 47844. For clarity and to reduce confusion, OCR accepts the recommendation to include State Medicaid programs, CHIP, and the Basic Health Program in paragraph (2) of the definition of “health program or activity.”

Comment: Numerous commenters objected to the 2022 NPRM's proposal to not explicitly include group health plans ^[48] in the list of entities considered to be principally engaged in paragraph (2) of the “health program or activity” Start Printed Page 37541 definition. Expressing concerns that this would result in confusion that the rule excludes group health plans, commenters urged OCR to reinstate the 2016 Rule's approach by expressly including group health plans in the definition of “health program or activity.” Former 45 CFR 92.4.

Commenters further suggested that the rule clarify that group health plans are covered entities when the group health plan itself receives Federal financial assistance or when the employer sponsoring the group health plan receives Federal financial assistance, such as through an Employer Group Waiver Plan (EGWP) or Retiree Drug Subsidy (RDS) plan. Some commenters argued that an employer and a group health plan should not be treated as distinct entities for purposes of section 1557 jurisdiction, and that group health plans should be considered indirect recipients of Federal financial assistance when the employer receives Federal funds.

Other commenters stated that employers are usually the sponsors of group health plans and were concerned that OCR's case-by-case analysis may find an employer liable under section 1557 based on the employee benefits it provides. Several commenters expressed concerns with OCR's proposed approach to conduct a case-by-case review to determine whether a group health plan is a covered entity and requested that OCR provide additional clarity on when employers and group health plans are liable under the rule.

Response: Commenters' concerns that group health plans would never be subject to the rule if they are not expressly included in the definition of “health program or activity” are unwarranted. The list of entities included as principally engaged, at paragraph (2), is not exhaustive. The fact that a group health plan is not expressly included in paragraph (2) does not affect the determination of whether a group health plan is principally engaged under this definition. As group health plans provide or administer group health coverage, they would be operating a health program or activity under the rule and would be subject to this rule if in receipt of Federal financial assistance. Further, recipient group health plans, like health insurance issuers, would be considered to be principally engaged in the provision or administration of health insurance coverage or other health-related coverage, meaning all their operations would be covered.

In the 2022 NPRM, we declined to expressly include group health plans in the definition of “health program or activity” in an attempt to reduce confusion because many group health plans do not receive Federal financial assistance. 87 FR 47845. It remains OCR's understanding that many group health plans do not receive Federal financial assistance, and thus we decline commenters' request to add group health plans to the non-exhaustive list of entities that are considered principally engaged that is provided in paragraph (2) of the definition of “health program or activity.”

A group health plan that receives Federal financial assistance itself is distinct from other entities that might separately receive Federal financial assistance, such as the plan sponsor of the group health plan or the third party administrator administering the plan. As such, a group health plan does not necessarily become a covered entity under this rule by virtue of the plan sponsor or third party administrator's receipt of Federal financial assistance. Single employers that are plan sponsors of single-employer group health plans and joint boards of trustees or similar bodies, associations, and other groups that are plan sponsors of multiemployer Taft-Hartley plans or multiple employer welfare arrangements (MEWAs) do not become covered entities under the rule due to their employment practices, including the provision of employee health benefits. Later in this section, we address how OCR will determine whether related business entities are considered separate legal entities under section 1557.

When OCR receives a complaint alleging discrimination related to a group health plan, we will conduct a fact-specific analysis to determine if the group health plan is a recipient or subrecipient of Federal financial assistance. We decline to take the position that a group health plan is an indirect recipient of Federal financial assistance whenever the plan sponsor receives Federal financial assistance. Determining whether an entity is an indirect recipient requires a fact-specific inquiry.^[49]

Entities that receive Federal financial assistance from the Department for an EGWP or RDS plan would be subject to this rule, though we note that employers and other plan sponsors are not subject to this rule with regard to their employment practices, pursuant to § 92.2(b). This includes when the Federal financial assistance received is for their employee health benefits. For more information about employer and plan sponsor liability, see the previous discussion under § 92.2(b).

In addition, as noted in the Proposed Rule, covered entities that contract with a group health plan could be subject to this rule themselves, regardless of the group health plan's liability. For instance, recipient health insurance issuers may be covered under this rule when offering health insurance coverage to a fully-insured group health plan or when providing third party administrator services for a self-funded group health plan.^[50] We also noted in the Proposed Rule at 87 FR 47845 that even if a group health plan is not subject to section 1557, group health plans may be subject to other Federal nondiscrimination requirements.^[51]

Comment: Some commenters urged OCR to expressly include pharmacy benefit managers in the definition of “health program or activity.” Commenters argued it was important to do so because pharmacy benefit managers play a significant role in developing and administering prescription drug benefits, and section 1557 can serve to prevent certain practices that may result in discriminatory access to medications, such as coverage criteria, utilization management practices, limitations on Start Printed Page 37542 where medicines can be dispensed, and high out of pocket costs.

Response: We decline to list pharmacy benefit managers expressly in paragraph (2) of the definition of “health program or activity.” Pharmacy benefit managers are entities that manage prescription drug benefits for issuers, group health plans, Medicare Part D drug plans, and other payers, such as State Medicaid programs (collectively known as “payers”).^[52] In their role of administering prescription drug benefits on behalf of payers, pharmacy benefit managers develop drug formularies and related policies, create pharmacy networks, reimburse pharmacies for patients' prescriptions, negotiate rebates and fees with drug manufacturers, process enrollees' claims and appeals, and review drug utilization, among other things.^[53] These activities constitute the operation of health programs and activities under section 1557.

If pharmacy benefit managers receive Federal financial assistance from the Department, either directly or indirectly, they are subject to this rule. Further, if they are principally engaged under paragraph (2), all their operations are covered by the rule.

As discussed previously, the fact that a type of entity—such as a pharmacy benefit manager—is not expressly included in the definition of “health program or activity” does not mean that those entities are excluded from the rule or could never be subject to section 1557 jurisdiction. Even if a pharmacy benefit manager does not receive direct Federal financial assistance, we note that the three largest pharmacy benefit managers are integrated with large health insurance or pharmacy companies, and thus could be covered under the rule as part of the operations of a health program or activity receiving Federal financial assistance.^[54] Determining whether a pharmacy benefit manager is subject to the rule as part of the operations of a recipient health program or activity is a fact-specific analysis based on the corporate structure of the entity.

Comment: Commenters requested that OCR provide more clarity on how it will analyze whether corporate subsidiaries and related business entities are subject to section 1557 as part of a covered entity's operations. Specifically, some commenters were concerned about health insurance issuers that receive Federal financial assistance avoiding responsibility through use of subsidiaries in their other activities, such as third party administrators or pharmacy benefit managers. Conversely, other commenters expressed concerns that the rule would apply too broadly to an issuer's business ventures that are unrelated to their federally funded activities.

Response: As stated throughout this section, if any part of a health program or activity receives Federal financial assistance and the entity administering said health program or activity is principally engaged as provided in paragraph (2), then all the operations of the recipient are subject to the rule. If a part of a recipient's operations is determined to be a separate legal entity independent from its federally funded activities, that part would not be subject to the rule. When determining whether an entity's subsidiaries or other entities are legally separate from the federally funded activities, OCR may consider—among other things—the organizational structure and the interrelatedness between the entities, such as the degree of common ownership, management, and control between the entities, and whether the entities share centralized control of labor relations; whether the entity has some ability to accept or reject the Federal funding or exercise controlling authority over a federally funded program; ^[55] and whether the purpose of the legal separation was to avoid liability or avoid the application of civil rights law requirements, meaning it is intended to allow the entity to continue to discriminate.^[56]

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “health program or activity” as proposed in § 92.4, with modifications. We have revised paragraph (1)(iv) to include clinical research, such that it will now read: “Engage in health or clinical research.” We have also revised paragraph (2) to include “a State Medicaid program, Children's Health Insurance Program, and Basic Health Program” as examples of entities principally engaged under this definition.

Information and communication technology (ICT). We proposed to define the term “ICT” to mean “information technology and other equipment, systems, technologies, or processes, for which the principal function is the creation, manipulation, storage, display, receipt, or transmission of electronic data and information, as well as any associated content.” We also provided examples of ICT in our proposed definition.

Comment: Some commenters urged OCR to include “electronic health records (EHRs)” as an example within the definition of “information and communication technology”.

Response: We appreciate that there are many different examples that can fit within the definition of “information and communication technology”. We agree that EHRs meet the definition of “information and communication technology”; however, we believe that it is unnecessary to specify this in the final rule.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “information and communication technology” as proposed in § 92.4, without modification.

Language assistance services. OCR proposed to define the term “language assistance services” to include, but not be limited to: (1) oral language assistance, including interpretation in non-English languages provided in-person or remotely by a qualified interpreter for a limited English proficient individual, and the use of services of qualified bilingual or multilingual staff to communicate directly with limited English proficient Start Printed Page 37543 individuals; (2) written translation, performed by a qualified translator, of written content in paper or electronic form into or from languages other than English; and (3) written notice of availability of language assistance services. The definitions of oral language assistance and written translation appeared in both the 2016 Rule at former § 92.4 and the 2020 Rule at § 92.101 in paragraphs (2)(i) and (iii) and have not been changed. The 2016 Rule did not explicitly include a written notice of availability of language assistance services in the definition of “language assistance services,” but rather included the term “taglines,” which was defined to mean “short statements written in non-English languages that indicate the availability of language assistance services free of charge.”

Comment: One commenter recommended that the definition of “language assistance services” include assistance with form completion in another language. The commenter noted that many individuals with limited English proficiency (LEP) as well as many others (including older individuals and those with limited access to technology) have difficulty completing online forms to apply for health benefits or report life changes.

Response: OCR appreciates the suggestion and agrees it is critical for individuals with LEP to receive language assistance in completing forms. The definition of “language assistance services” is intended to provide a non-exhaustive list of some of the means by which a covered entity may facilitate such access—namely, oral interpretation and written translation as provided by qualified interpreters and translators, respectively. This definition works together with the requirements at § 92.201, which provide that covered entities must take reasonable steps to provide meaningful access to individuals with LEP. If an individual with LEP needs assistance with form completion in a covered health program or activity, a covered entity must provide language assistance services consistent with the requirements at § 92.201. OCR declines to modify the definition of “language assistance services” as suggested because the context in which services are provided is not germane to the definition.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “language assistance services” as proposed in § 92.4, with modification. As discussed in the following summary of regulatory changes to the proposed term “limited English proficient individual,” we are revising the term to “individual with limited English proficiency” in § 92.4.

Limited English proficient individual. OCR proposed to define the term “limited English proficient individual” to mean “an individual whose primary language for communication is not English and who has a limited ability to read, write, speak, or understand English.” Further, OCR proposed that a “limited English proficient individual” “may be competent in English for certain types of communication ( e.g., speaking or understanding), but still be limited English proficient for other purposes ( e.g., reading or writing).” These definitions appeared in the 2016 Rule and have not changed substantively. Former 45 CFR 92.4 (2016 Rule). OCR sought comment on whether to use the term “limited English proficient individual” or “individual with limited English proficiency” throughout the rule.

Comment: Some commenters recommended the final rule adopt the language either “people with limited English proficiency” or “individual with limited English proficiency” instead of “limited English proficient individual.”

Response: OCR agrees with this recommendation and OCR is finalizing the rule with the term “individual with limited English proficiency” throughout.

Comment: Several commenters supported the proposed definition's emphasis that an individual with LEP includes those who may be competent in English for certain types of communication but still have limited English proficiency for other purposes. Commenters explained that this will ensure providers and other covered entities understand that people who have some English competency may still need translated written materials. Commenters noted this will improve language access and have far-reaching consequences for patients who both seek and receive care, which will also reduce barriers to quality health care for individuals with LEP.

Response: We appreciate the support of inclusion of additional details around what it means to be “limited English proficient” and are finalizing the definition as proposed.

Comment: A few commenters that agreed with the proposed definition urged that the word “and” be replaced with “or” to read “an individual whose primary language for communication is not English or who has a limited ability to read, write, speak, or understand English . . .” These commenters explained that there are many people in the United States whose primary language is English but who have a limited ability to read, write, speak, or understand English, for reasons that may or may not be related to disability, who deserve protection from discrimination.

Response: OCR appreciates the commenters' recommendation and recognizes that there are many individuals whose primary language is English but who have a limited ability to read, write, speak, or understand English. However, section 1557's language access provisions rely on the statute's prohibition on national origin discrimination.^[57] For individuals with LEP, the lack of proficiency in English and the use of non-English languages is often tied to their national origin. Changing the definition to include an individual who has a limited ability to read, write, speak, or understand English, but whose primary language is English, would go beyond national origin discrimination. With respect to individuals who have a limited ability to read, write, speak, or understand English related to disability, § 92.202 addresses requirements for effective communication for individuals with disabilities, which is a long-standing requirement.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “limited English proficient individual” as proposed in § 92.4, with modification. We are changing “limited English proficient individual” to “individual with limited English proficiency” in § 92.4 and throughout the final rule.

Machine translation. OCR proposed to define the term “machine translation” to mean “automated translation, without the assistance of or review by a qualified human translator, that is text-based and provides instant translations between various languages, sometimes with an option for audio input or output.” Neither the 2016 Rule nor the 2020 Rule addressed machine translation. We invited comment on the adequacy of this new definition.

Comment: We received many comments in support of the inclusion of a definition of “machine translation”. One commenter supported the language as proposed but noted the importance of adaptability and potential for future regulation or guidance over time as Start Printed Page 37544 technology changes. For example, machine translation companies may develop technology that includes some level of human review but remains insufficient for the purposes of conforming with the intent of this rule.

Response: We appreciate commenters' support for the inclusion of this definition. The requirement to provide written translations via a qualified translator included at § 92.201(c)(2) continues to apply, regardless of whether human or machine translation is provided. Section 92.201(c)(3) requires a human translator to review machine translation under certain circumstances. The circumstances outlined in § 92.201(c)(3) set a minimum requirement for when machine translations must be reviewed by a qualified human translator—including circumstances that are critical to one's rights or benefits. Thus, any machine translation technologies that are developed must include such review if they are to meet the requirements of this rule. OCR will continue to monitor the progression of this technology and will revisit regulatory updates as well as consider issuance of future guidance as needed.

Comment: One commenter stated that the definition of “machine translation” should include reference to the use of software or automated tools. Specifically, the commenter recommended modifying the language to read “machine translation is the use of automated translation software or tools, without the assistance of . . .”

Response: OCR appreciates the commenter's suggestion to explicitly refer to software or automated tools; however, the definition as proposed sufficiently accounts for translations that would be generated by software or automated tools as it refers to “automated translation.”

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “machine translation” as proposed in § 92.4, with modification. We are making a technical correction to change “automated translations” to “automated translation.”

National Origin. We proposed to define the term “national origin” to mean “a person's, or their ancestor's, place of origin or a person's manifestation of the physical, cultural, or linguistic characteristics of a national origin group.” This is consistent with the 2016 Rule's definition of “national origin,” and with the well-established definition of the term that the Equal Employment Opportunity Commission (EEOC) uses in its interpretation of title VII.^[58]

Comment: Various commenters discussed the need to include this definition to address entrenched inequities and practices that can constitute national origin discrimination but are not always recognized. This includes the failure to take reasonable steps to provide meaningful access for individuals with LEP, even though such a failure has been long recognized as a form of national origin discrimination. Commenters added that there are also clear intersections between LEP status and race and ethnicity because the great majority of individuals with LEP are people of color; however, they noted that when individuals seek to vindicate their civil rights, they often must choose between pursuing a claim based on either their LEP status or race. Commenters also provided examples of how some people have been denied benefits they are entitled to due to national original discrimination. Several national organizations and local service providers commented that refugees, migrant workers, and other immigrants experience barriers to federally funded or provided health care due to fears related to their immigration status.

Response: OCR appreciates commenters' support for inclusion of this definition. We recognize that individuals can experience both national origin and race discrimination (or national origin discrimination and discrimination on another protected basis) and are finalizing new regulatory language that provides additional clarity and addresses such instances in which individuals may experience discrimination under multiple bases. See discussion regarding § 92.101.

OCR appreciates comments related to immigration status. While section 1557 does not prohibit discrimination on the basis of immigration status, we note that differential treatment such as requiring additional verification or documentation from individuals based on their appearance, name, accent, LEP, or suspected immigration status may violate section 1557 and other civil rights laws.^[59]

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “national origin” as proposed in § 92.4, with modification. We are making a technical correction to change “ancestor's” to “ancestors'.”

Patient care decision support tool. The Proposed Rule described but did not include a definition in § 92.4 for, the term “clinical algorithms.” See87 FR 47880. Many commenters supported the inclusion of a provision such as proposed § 92.210, addressing nondiscrimination in the use of clinical algorithms in decision-making, but recommended OCR clarify that the provision applies to tools used to assess health status, recommend care, determine eligibility, allocate resources, conduct utilization review, and provide disease management guidance. Further, commenters requested that OCR define what tools are covered under § 92.210.

Based on comments received, we are replacing the term “clinical algorithm” with the more precise term “patient care decision support tool,” and we are adding a definition for “patient care decision support tool” to mean “any automated or non-automated tool, mechanism, method, technology, or combination thereof used by a covered entity to support clinical decision-making in its health programs or activities.” The definition of “patient care decision support tool” reaffirms that § 92.210 applies to tools used in clinical decision-making that affect the care that patients receive. This includes tools, described in the Proposed Rule, used by covered entities such as hospitals, providers, and payers (health insurance issuers) in their health programs and activities for “screening, risk prediction, diagnosis, prognosis, clinical decision-making, treatment planning, health care operations, and allocation of resources” as applied to the patient. 87 FR 47880. We clarify that tools used for these activities include tools used in covered entities' health programs and activities to assess health status, recommend care, provide disease management guidance, determine eligibility and conduct utilization review ^[60] related to patient care that is Start Printed Page 37545 directed by a provider, among other things, all of which impact clinical decision-making. Please see our discussion regarding § 92.210, where we discuss “patient care decision support tool” in more detail, including examples of tools to which § 92.210 does not apply.

Summary of Regulatory Changes

Considering the comments received, we are finalizing the definition of “patient care decision support tool” in § 92.4 to mean “any automated or non-automated tool, mechanism, method, technology, or combination thereof used by a covered entity to support clinical decision-making in its health programs or activities.”

Qualified Bilingual/Multilingual Staff. OCR proposed to define the term “qualified bilingual/multilingual staff” to mean a member of a covered entity's workforce who is designated by the covered entity to provide oral language assistance directly to an individual in their primary language as part of the person's current, assigned job responsibilities and who has demonstrated to the covered entity that they are: (1) proficient in speaking and understanding both spoken English and at least one other spoken language, including any necessary specialized vocabulary, terminology, and phraseology; and (2) able to effectively, accurately, and impartially communicate directly with individuals with LEP in their primary language.

Comment: Some commenters urged that additional attention should be given to assessing qualifications for self-identified bilingual/multilingual staff abilities to provide services in languages other than English, and that policies and procedures should be developed to assess and retain their competency. Additionally, some commenters recommended establishing qualifications for bilingual/multilingual staff who may also be expected to serve as interpreters, and added that they should be compensated appropriately. Commenters stated that research has shown that bilingual staff who are not qualified interpreters often do not feel comfortable serving as interpreters. A commenter posited that bilingual/multilingual staff must be provided training and compensation opportunities to support professional development and prevent staff turnover and burnout.

Response: OCR appreciates the commenters' suggestions to establish assessment requirements for qualified bilingual/multilingual staff; however, we believe the current definition establishes sufficient requirements and guidelines regarding the necessary skills a qualified bilingual/multilingual staff member must have. The definition sets forth a two-prong definition to ensure proficiency, effectiveness, and impartiality in direct communications with individuals with LEP in their primary languages, including any necessary specialized vocabulary, terminology, and phraseology. Similar to the rule's definitions for qualified interpreters and qualified translators, OCR has established the necessary skills that must be held to meet the definition, while providing covered entities the flexibility by which to have these skills assessed. We note that an individual's self-identification as bilingual or multilingual alone is insufficient to determine whether they meet this definition, and covered entities should determine processes by which they will independently determine and periodically assess an individual's qualifications.

While qualified bilingual/multilingual employees may also be qualified interpreters, the ability to interpret is a separate skill. Anyone whom a covered entity allows to serve as an interpreter must be qualified to do so, consistent with the definition of “qualified interpreter for an individual with limited English proficiency” in this section, independent of whether they have been identified as a qualified bilingual/multilingual staff member. OCR will consider developing guidance and providing technical assistance for covered entities on mechanisms for covered entities to assess if staff members meet the requirements.

Consistent with the Department's approach on language access, OCR encourages covered entities to provide training and compensation opportunities to support professional development for bilingual/multilingual staff.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “qualified bilingual/multilingual staff” as proposed in § 92.4, with modification. As discussed in the summary of regulatory changes to the proposed term “limited English proficient individual,” we are revising the term to “individual with limited English proficiency” in § 92.4.

Qualified interpreter for an individual with a disability. We proposed to define the term “qualified interpreter for an individual with a disability” to mean “an interpreter who . . . is able to interpret effectively, accurately, and impartially, both receptively and expressively, using any necessary specialized vocabulary.” Such an interpreter may interpret via a video remote interpreting service (VRI) or in person. We also provided a non-exhaustive list of examples of qualified interpreters, to include sign language interpreters, oral transliterators, and cued-language transliterators.

Comment: Most of the commenters recommended that OCR amend this definition to include the three (3) parts of the definition of “qualified interpreter for an individual with limited English proficiency”, which requires that the qualified interpreter: (1) has demonstrated proficiency, (2) is able to interpret effectively, accurately, and impartially, (3) and adheres to generally accepted interpreter ethics principles. Commenters noted that these revisions would provide alignment between the different types of interpreters and recognize that similar standards should apply regardless of whether an interpreter is interpreting for an individual with LEP or a person with a disability.

Commenters recommended that the definition include that a qualified interpreter for a person with a disability demonstrate proficiency. For sign language interpreters, this should include proficiency in speaking or communicating in and understanding both English and a relevant sign language, noting that not all individuals who are deaf or hard of hearing are signers of American Sign Language (ASL). Some commenters also recommended that in order to be proficient, Certified Deaf Interpreters (CDI) must have specialized training in Deaf interpreting in addition to the basic CDI training. For transliterators, these commenters recommended that the rule require proficiency in the relevant alternative communication modality, such as cued speech or oral transliteration.

Commenters further stated that an interpreter for an individual with a disability should communicate “without changes, omissions, or additions while preserving the tone, sentiment, and emotional level of the original statement.”

Finally, commenters stated that an interpreter for an individual with a disability must also adhere to the principles contained in recognized standards of practice and professional codes of ethics for health care interpreters, such as those of the National Council on Interpreting in Health Care and the Registry of Interpreters for the Deaf.

Response: We appreciate commenters' recommendation to revise the definition Start Printed Page 37546 of “qualified interpreter for an individual with a disability” to align more closely with the definition of “qualified interpreter for an individual with limited English proficiency”. While the proposed definition is consistent with the ADA, we agree that the standards for a qualified interpreter should be equivalent regardless of whether an individual has LEP or has a disability. We have revised the definition for consistency among the standards, which is also consistent with the 2016 Rule's definition at former 45 CFR 92.4.

Comment: Some commenters recommended aligning the two qualified interpreter definitions but recommended that a revised definition be expanded to recognize qualified interpreters who have demonstrated proficiency in speaking and understanding two non-English languages. These commenters noted that not all interpreters for people with disabilities are interpreting between English and another language. For example, these commenters noted that a CDI may be interpreting between an individual who is deaf and uses a unique version of ASL and a non-American sign language, or home signs unfamiliar to the medical interpreter. Commenters were concerned that a definition that specified interpretation “between English and non-English language” would exclude CDIs and cued-language transliterators. These commenters recommended a multi-pronged definition where several contexts are taken into consideration and is inclusive of ASL-to-English interpretation, ASL-to-ASL CDI interpretation, and cued-language transliteration.

Response: As proposed, the definition of “qualified interpreter for an individual with a disability” does not reference “English” or a “non-English language,” but rather included a non-exhaustive list of examples of qualified interpreters inclusive of sign language interpreters, oral transliterators, and cued-language transliterators. However, as previously discussed, we have revised the definition of “qualified interpreter for an individual with a disability” to be more aligned with the definition of “qualified interpreter for an individual with limited English proficiency.” The revised definition includes language that is inclusive of different types of interpretation and also includes the non-exhaustive list of examples from the proposed definition.

Comment: Some commenters noted that a covered entity must not use the services of staff who use sign language or another communication modality to act as interpreters and relay information to individuals with disabilities unless they meet the definition of a “qualified interpreter for an individual with a disability” found within this section, and they meet the unique needs of the individual for whom the services of an interpreter is being provided.

Response: The definition of a “qualified interpreter for an individual with a disability” addresses these concerns; and anyone designated by a covered entity to serve as an interpreter for an individual with a disability must be qualified to do so.

Comment: Some commenters recommended that the definition of “qualified interpreter for a person with a disability” take into consideration applicable State law governing licensure of interpreters if any are available in the State where the covered entity provides services. These commenters noted that the process of who can serve as a qualified interpreter differs from State to State, and OCR should adopt language that reflects the minimum standards of State laws governing qualifications of sign language interpreters, if any.

Response: OCR understands and appreciates commenters raised concerns. Covered entities may use adherence to State law governing licensure as a means by which to demonstrate compliance with this definition, provided licensure demonstrates the individual possesses the requirements provided in the definition. OCR declines to adopt language that incorporates any State law licensure requirements as a minimum standard of compliance with this rule.

Comment: Some commenters raised concerns over the qualifications of interpreters. Commenters recommended that the definition include the requirement that an interpreter be certified or assessed by a formal process that objectively measures the competency of the individual. Other commenters recommended that health care entities include a screening system to ensure quality assurance of the abilities of the sign language interpreters to meet the needs of the patients.

Response: OCR appreciates the commenters' recommendations to require certification for qualified interpreters and agrees that covered entities should ensure that the use of interpreter services provides for effective communication. OCR will take into account certification in assessing compliance with this regulation; however, as we will discuss below in the response for certification of qualified interpreter for an individual with LEP in § 92.201, we decline to require certification in the definition of “qualified interpreter for an individual with a disability.”

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “qualified interpreter for an individual with a disability” in § 92.4, to more closely align with the definition of “qualified interpreter for an individual with limited English proficiency,” such that it now means an interpreter who, via a video remote interpreting service (VRI) or an on-site appearance: (1) has demonstrated proficiency in communicating in, and understanding: (i) both English and a non-English language (including American Sign Language, other sign languages); or (ii) another communication modality (such as cued-language transliterators or oral transliteration); (2) is able to interpret effectively, accurately, and impartially, both receptively and expressively, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original statement; and (3) adheres to generally accepted interpreter ethics principles including client confidentiality. Qualified interpreters include, for example, sign language interpreters, oral transliterators, and cued-language transliterators.

Qualified interpreter for a limited English proficient individual. OCR proposed to define the term “qualified interpreter for a limited English proficient individual” to mean an interpreter who via a remote interpreting service or an on-site appearance: (1) has demonstrated proficiency in speaking and understanding both spoken English and at least one other spoken language; (2) is able to interpret effectively, accurately, and impartially to and from such language(s) and English, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original oral statement; and (3) adheres to generally accepted interpreter ethics principles, including client confidentiality. This definition is consistent with both the 2016 Rule at former § 92.4 and the 2020 Rule at § 92.101(b)(3)(i).

Comment: Some commenters who otherwise supported this definition expressed concern that, as written, it may inadvertently create difficulties for interpreting in certain languages, especially indigenous languages of Central and South America. These Start Printed Page 37547 commenters recommended that the definition be amended to allow for the use of services of relay interpreters, such as those who are proficient in an indigenous language and another language such as Spanish. Commenters explained that these interpreters may not be fluent in spoken English or trained to interpret to and from spoken English, and that those who are qualified to interpret between two non-English languages are critical in providing meaningful access for many isolated and marginalized communities. Furthermore, a few of these commenters recommended the inclusion of the following definition for relay interpreting: “relay interpreting means a form of simultaneous interpreting when the speech is rendered from an intermediate language rather than directly from the source language.”

One commenter recommended adding “and dialect” after “spoken language” under paragraph (1) to acknowledge that speakers of a language may not always be qualified to interpret for a person who speaks a variation in that language and adding “understanding and” before “using necessary specialized vocabulary or terms” under paragraph (2) to indicate that providing effective interpretation for complex situations, such as communicating a treatment regimen, requires understanding of the terminology being used, particularly given the consequences of a miscommunication.

Response: OCR appreciates and understands concerns that the proposed definition may inadvertently create obstacles for meaningful access in certain languages. For example, if a Zapotec-speaking patient with LEP attended a medical appointment and the hospital could not find an individual qualified to interpret between Zapotec and English after reasonable efforts, the hospital could utilize the services of two qualified interpreters that could perform relay interpretation between Zapotec and Spanish and Spanish and English. While relay interpretation may introduce challenges related to accuracy, it may be necessary to afford meaningful access for individuals who speak languages, dialects, or variants not common to the area where they are receiving services.

For this reason, we are revising the definition of a “qualified interpreter for an individual with limited English proficiency” to provide that the qualified interpreter (1) has demonstrated proficiency in speaking and understanding both spoken English and at least one other spoken language (qualified interpreters for relay interpretation must demonstrate proficiency in two non-English spoken languages); and (2) is able to interpret effectively, accurately, and impartially to and from such language(s) and English (or between two non-English languages for relay interpretation), using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original oral statement. This provision makes clear that specialized skills and vocabulary may be needed for less commonly spoken languages as well as dialects.

In light of these modifications to the definition of “qualified interpreter for an individual with limited English proficiency”, we are also adding and finalizing a definition of “relay interpretation” to mean interpreting from one language to another through an intermediate language. This mode of interpretation is often used for monolingual speakers of languages of limited diffusion, including select indigenous languages. In relay interpreting, the first interpreter listens to the speaker and renders the message into the intermediate language. The second interpreter receives the message in the intermediate language and interprets it into a third language for the speaker who speaks neither the first nor the second language.

Lastly, OCR appreciates the commenter's suggestion to add “understanding and” before “using necessary specialized vocabulary or terms” under paragraph (2). However, the interpreter themself does not need to understand complex medical concepts behind medical terms but rather must be able to interpret said terms effectively and accurately. OCR is of the view that the interpretation should directly convey the provider and patient's words and phrases in order to avoid the risk that the individual's message was not accurately communicated. Further, paragraph (1) already requires that the interpreter have “proficiency in speaking and understanding” the languages at issue (emphasis added).

Comment: A few commenters recommended the definition address how an individual would demonstrate proficiency in English and another language ( i.e., through use of an established standard for describing language ability, such as the Common European Framework of Reference of Languages ^[61] ). Some commenters recommended implementing a certification requirement and suggested implementing a national credential requirement that establishes interpretation proficiency for enforcement purposes. Some commenters requested that OCR lay out examples of when it would be appropriate to require qualified interpreters to obtain certification in order to comply with section 1557. Commenters expressed their belief that the proposed definition could be easily misinterpreted and result in assigning the least skilled interpreter for a medical encounter.

Response: OCR appreciates the commenters' suggestions to establish certification requirements for qualified interpreters; however, there are currently no consistent certification standards and there is also a lack of certification available for a significant number of languages. The requirements in this definition provide sufficient standards for determining interpreter qualifications. Individuals that hold a certification will still need to meet the standards provided in this definition. For covered entities seeking information on certification, we encourage covered entities to review the Department of Justice's (DOJ) resource regarding what it means to be a certified linguist.^[62]

Comment: One commenter encouraged OCR to include “via a video remote interpreting service” to the definition because telehealth can be an important tool for expanding access to interpretation for individuals with LEP.

Response: The definition as proposed and finalized includes interpreter services provided via remote interpreting services and is therefore inclusive of video remote interpreting as drafted.

Comment: One commenter noted that we use the phrase “use an interpreter” in our text. They recommended we use the wording “utilize the services of an interpreter” instead.

Response: OCR agrees that we are referring to the utilization of interpreter services and have adjusted the use of this phrase accordingly.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments we received, we are revising the definition for a “qualified interpreter for an individual with limited English proficiency” as proposed in § 92.4, with modifications. To account for concerns related to relay Start Printed Page 37548 interpreting, we are revising paragraph (1) to add “(qualified interpreters for relay interpretation must demonstrate proficiency in two non-English spoken languages).” As discussed in the summary of regulatory changes to the proposed term “limited English proficient individual” we are revising the term to “individual with limited English proficiency” in § 92.4. We are also adding a definition of “relay interpretation” to § 92.4 to mean interpreting from one language to another through an intermediate language. This mode of interpretation is often used for monolingual speakers of languages of limited diffusion, including select indigenous languages. In relay interpreting, the first interpreter listens to the speaker and renders the message into the intermediate language. The second interpreter receives the message in the intermediate language and interprets it into a third language for the speaker who speaks neither the first nor the second language.

Qualified Reader. We proposed to define the term “qualified reader” to mean “a person who is able to read effectively, accurately, and impartially using any necessary specialized vocabulary,” which comes from the ADA title II regulation at 28 CFR 35.160 through 35.164. This definition, which did not appear in the 2016 or 2020 Rules, was included to provide clarity to both covered entities and protected individuals about the necessary qualifications of a reader when required under this regulation.

Comment: Commenters supported the addition of “qualified reader” to the proposed list of definitions.

Response: OCR appreciates the commenters support for adding the definition of “qualified reader” to the proposed list of definitions.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments we received, we are finalizing the definition of “qualified reader” as proposed in § 92.4, without modification.

Qualified Translator. OCR proposed to define the term “qualified translator” to mean a translator who: (1) has demonstrated proficiency in writing and understanding both written English and at least one other written non-English language; (2) is able to translate effectively, accurately, and impartially to and from such language(s) and English, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original written statement; and (3) adheres to generally accepted translator ethics principles, including client confidentiality. This definition of “qualified translator” appeared in the 2016 Rule at § 92.4 and appears in the 2020 Rule at § 92.102(b)(2)(ii) and has not been changed.

Comment: One commenter recommended that the definition of a “qualified translator” include the requirement that such individuals, for purposes of providing translation services, be certified or assessed by a formal process that objectively measures the competency of the individual. A number of commenters stated that high quality translation is essential to providing equal access to health care and health services. Some added that oral interpretation is critical to ensuring understanding of written translations, some of which have been inaccurate or insufficient to convey the complicated medical and technical terms translated in the communications.

Response: OCR appreciates the commenter's suggestion to require that a qualified translator be certified or objectively assessed to verify competency in translating. For the reasons we provided when declining to require certification of qualified interpreters for individuals with LEP, we decline to specify the means by which a covered entity may determine that an individual meets the definition of “qualified translator”. In order to be qualified, translators must meet the definition provided in the rule. OCR also notes that reasonable steps to provide meaningful access may require the provision of both written translation and oral interpreting, and thus utilizing the services of both a qualified translator and a qualified interpreter may be necessary under certain circumstances.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of “qualified translator” as proposed in § 92.4, without modification.

State. The 2022 NPRM did not propose a definition of the term “State.” However, based on comments received, we became aware that there may be some confusion as to what encompasses “State” for purposes of this final rule. We therefore have decided to include a definition of “State.”

Summary of Regulatory Changes

Considering the comments received, we are finalizing a definition of “State” in § 92.4 to mean “each of the several States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the Virgin Islands, the Trust Territory of the Pacific Islands, and the Commonwealth of the Northern Mariana Islands.” This definition is consistent with the ADA regulations at 28 CFR 35.104.

Telehealth. The 2022 NPRM did not propose a definition of the term “telehealth.” However, based on comments received, we became aware that there may be some confusion as to what encompasses “telehealth” for purposes of this final rule. We therefore have decided to include a definition of “telehealth.”

Summary of Regulatory Changes

Considering the comments received, we are finalizing a definition of “telehealth” in § 92.4 to mean the use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional health-related education, public health, and health administration. Technologies include videoconferencing, the internet, store-and-forward imaging, streaming media, and terrestrial and wireless communications. This definition is consistent with the Health Resources and Services Administration and the Office of the National Coordinator for Health Information Technology definitions referenced in the 2022 NPRM, 87 FR 47884.

Assurances Required (§ 92.5)

In § 92.5 of the 2022 NPRM, we proposed retaining the requirement of the 2016 and 2020 Rules, at former § 92.5 and current § 92.4 respectively, for recipients to submit assurances of compliance to OCR. In paragraph (a), we proposed that each entity applying for Federal financial assistance, each issuer seeking certification to participate in an Exchange, and each State seeking approval to operate a State Exchange is required to submit an assurance that its health programs and activities will be operated in compliance with section 1557 and this part, consistent with similar requirements found in the implementing regulations for title VI, title IX, section 504, and the Age Act. The duration of obligation (proposed paragraph (b)), and covenants language (proposed paragraph (c)) adopt the corresponding requirements found in the section 504 regulation at 45 CFR 84.5.

The comments and our responses regarding § 92.5 are set forth below.

Comment: Commenters expressed support for the assurances provision included in the 2022 NPRM because it Start Printed Page 37549 is consistent with other Federal civil rights regulations and the 2016 and 2020 Rules, and it is reasonable for OCR to require recipients of Federal financial assistance to comply with section 1557 as a condition of receiving that funding. One organizational commenter recommended revising this requirement to conditioning prospective recipients' receipt of Department Federal financial assistance on recipients': (1) collection of demographic data such as race, ethnicity, spoken and written language, disability status, age, sex, gender identity, sex characteristics, and sexual orientation; and (2) submission of a written proposal (including through written policies and procedures) about how they intend to provide language assistance services, auxiliary aids and services, and whether an entity's proposed budget includes funding to meet these identified needs.

Response: We appreciate the suggestion to include a data collection requirement in this provision, but do not believe such a requirement is appropriate, as this language is longstanding and consistent across civil rights regulations. We address data collection in further detail later in this preamble, when discussing responses to our request for comment on the issue.

We also decline to revise § 92.5 to require Federal financial assistance applicants to provide OCR with budget information and a written proposal about how they intend to provide language assistance services and auxiliary aids and services as a condition of receiving Federal financial assistance. The combined requirements at §§ 92.8 (Policies and procedures), 92.201 (Meaningful access for individuals with LEP), 92.202 (Effective communication for individuals with disabilities), and 92.205 (Requirement to make reasonable modifications) address the commenter's concerns regarding a recipient's obligation and ability to provide language assistance services and auxiliary aids and services.

Comment: One commenter raised concerns that proposed § 92.5's requirement that recipients make assurances to comply with all provisions of the rule does not take into account situations where a third party administrator could otherwise lawfully administer a plan sponsored by a religious employer that does not conform to OCR's current interpretation of section 1557 with regard to the prohibition on sex discrimination. Specifically, the commenter suggested that a third party administrator may be inhibited from submitting an assurance required by § 92.5 because (1) of the Employee Retirement Security Act of 1974 (ERISA), 29 U.S.C. 1104(a)(1)(D), which for example, obligates such a third party administrator to administer the religious employer's self-insured health plan in accordance with terms that may conflict with section 1557's prohibition of sex discrimination; and (2) there are injunctions that currently prohibit OCR from enforcing prohibitions on sex discrimination against religious employers and those acting in concert with them.^[63]

Response: OCR complies with court orders, including court-ordered injunctions. If a recipient third party administrator is covered by any current court order or court-ordered injunction, OCR would not find the third party administrator to be in violation of section 1557 or this rule for its activities that are covered by the injunction, and such an entity would not need to provide an assurance under § 92.5 to the extent it conflicts with a current court order or court-ordered injunction by which they are covered.

Regarding the commenter's point that third party administrators are required under ERISA to administer plans consistent with the plan's terms, OCR addresses this issue in detail under the third party administrator section of § 92.207. In short, while we acknowledge that ERISA requires plans to be administered consistent with the documents and instruments governing the plan,^[64] ERISA further provides that it is not to be construed to impair or supersede other Federal laws, including regulations issued under such laws.^[65] Courts have held that ERISA's requirement to comply with the terms of the plan must not be construed to invalidate or impair section 1557.^[66]

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.5, without modification.

Remedial Action and Voluntary Action (§ 92.6)

In § 92.6, OCR proposed to include requirements regarding remedial and voluntary action, which would reinstate former § 92.6 in the 2016 Rule and is consistent with parallel requirements in the implementing regulations for section 504, title IX, and the Age Act. The 2020 Rule does not include a similar provision. In § 92.6(a)(1) of the 2022 NPRM, we proposed requiring recipients or State Exchanges that have been found by the Director to have engaged in discriminatory conduct in their health programs and activities in violation of this part to take voluntary actions to remediate the effects of such discriminatory conduct. Similarly, we proposed that under § 92.6(a)(2), where a recipient exercises control over another recipient that has discriminated, the Director may require either or both entities to take remedial action. Under proposed § 92.6(a)(3), a recipient or State Exchange must take remedial action if OCR requires such action to redress the harm experienced by an individual who was subjected to prohibited discrimination. Under proposed § 92.6(b), a covered entity may voluntarily take nondiscriminatory steps to overcome the effects of the conditions that limited an individual's ability to participate in a health program or activity based on their race, color, national origin, sex, age, or disability.

The comments and our responses regarding § 92.6 are set forth below.

Comment: Commenters generally supported the requirement that a recipient remedy instances of confirmed discrimination and the voluntary action provision that allows for covered entities to address effects of past discrimination.

One commenter recommended that we limit the application of this provision to avoid exposing recipients to unfair and specious claims of discrimination. Specifically, the commenter suggested that the remedial action be limited to: (1) individuals who applied to participate in a health program or activity but were unable to participate due to alleged discrimination; or (2) individuals who had been participants in a health program or activity but are no longer participants due to alleged discrimination. Start Printed Page 37550

Response: This provision is an essential tool in remediating findings of discrimination and encouraging recipients to take voluntary actions to overcome potential discrimination. The suggested revisions to § 92.6 are unnecessary, as they generally request implementing conditions that are already present. For example, § 92.6(a)(1) requires remedial action by a recipient or State Exchange only after a finding of discrimination. Section 92.6(a)(3) limits any required remedial action in the spirit of the commenter's recommendation, namely providing that recipients and State Exchanges take remedial action with respect to individuals who were or would have been participants in the health program or activity had the discrimination not occurred.

Covered entities are prohibited from discriminating and as such should take steps to ensure nondiscrimination, even in the absence of a finding of discrimination by OCR. Where a covered entity has identified conditions that currently or in the past had resulted in limited participation in their health programs and activities by individuals protected by this rule, they are encouraged to take the voluntary action contemplated in § 92.6(b).

We also note that regulations for section 504, title IX, and the Age Act require recipients to take remedial action, and recipients have complied with the remedial action provisions in those civil rights statutes for more than 40 years.^[67] For example, where there is a finding that a recipient engaged in disability discrimination, the recipient's remedial action to overcome the effects of the disability discrimination would likely satisfy this provision's remedial action requirement as well as section 504's remedial action requirement at 45 CFR 84.6(a).

Comment: Another commenter expressed concern about the obligation this provision places on a recipient that exercises control over another recipient that is found to have engaged in discrimination prohibited by section 1557. The commenter recommended that OCR revise the provision so that only the recipient that OCR found to have engaged in unlawful discrimination (and not the controlling entity) take remedial action and that OCR enumerate specific remedial actions OCR may require and the circumstances under which OCR may require them.

Response: The word “control” has appeared in civil rights regulations enforced by OCR for many years, and its meaning has been established over time. As we explained in the preamble for the 2016 Rule, OCR's experience and the longstanding approach for controlling entities to secure appropriate action from discriminating entities over which they have control has played an important role in remedying discrimination. 81 FR 31393. Given that nothing has changed in OCR's experience in the intervening years regarding the principles of “control” as applied here, we decline to define the term “control.”

While we appreciate the commenter's request to list the remedial actions OCR may require of a recipient or State Exchange found in violation of this part, the remedial actions that a recipient or State Exchange must take to address confirmed discrimination will be subject to the facts involved in a particular case. A review of past resolution agreements provides useful, though not exhaustive, examples of the variety of means by which OCR achieves corrective action.^[68]

Comment: One commenter recommended that OCR revise § 92.6 to require a recipient or State Exchange to notify participants, enrollees, and beneficiaries of any finding of discrimination by the Director and the remedial action the recipient has taken or will take to address the confirmed discrimination.

Response: We recognize the benefit that notice of confirmed discrimination and the steps a recipient or State Exchange will take to remedy the discrimination can provide to participants, enrollees, and beneficiaries. While we encourage recipients and State Exchanges to provide notice to participants, we decline to require they do so. Current Federal civil rights regulations with similar remedial and voluntary action provisions do not include a notice requirement, and we do not believe imposing such a requirement on recipients and State Exchanges is warranted at this time. We note, however, it is OCR's practice to notify the public via a press release or posting on our website when a violation has been found or a resolution has been reached.^[69] Additionally, OCR has established a Civil Rights listserv to inform the public about civil rights settlement and enforcement activities, press releases, FAQs, guidance, and technical assistance materials. To subscribe to OCR's Civil Rights listserv, please visit https://list.nih.gov/​cgi-bin/​wa.exe?​SUBED1=​OCR-CIVILRIGHTS-LIST&​A=​1.

Comment: One commenter recommended that, for § 92.6(b) (voluntary action), we replace “may” with “must” to require covered entities to take nondiscriminatory steps to overcome effects that result or resulted in limiting participants ability to participate in the covered entity's health program or activities based on the participants' race, color, national origin, sex, age, or disability.

Response: Such a revision would alter the voluntary nature of the provision, which encourages covered entities to take nondiscriminatory steps on their own accord to make their programs more inclusive absent a finding of discrimination. We note that, when there is a finding that prohibited discrimination occurred, § 92.6(a) mandates the offending recipient or State Exchange to take action to remedy such discrimination.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.6, without modification.

Designation and Responsibilities of a Section 1557 Coordinator (§ 92.7)

In proposed § 92.7(a), OCR proposed requiring covered entities with 15 or more employees to designate at least one employee to serve as a Section 1557 Coordinator (“Coordinator”) to coordinate their efforts to comply with and carry out the covered entity's responsibilities under section 1557 and the part. OCR also proposed to permit covered entities to, as appropriate, assign one or more designees to carry out some of the responsibilities of the Coordinator.

In § 92.7(b), we proposed a list of responsibilities of the Coordinator. We invited comment on this requirement, including whether OCR should require covered entities with fewer than 15 employees to designate a Coordinator and, if so, whether there should be a requisite number of employees or whether all covered entities should be required to designate a Coordinator. We further sought comment on whether the enumeration of responsibilities of the Coordinator is beneficial and sufficiently comprehensive. We also requested comment on how the Start Printed Page 37551 Department can support Coordinators, including through the provision of training, so that they understand their duties, the protections afforded by section 1557, and the rationales for both.

The comments and our responses regarding § 92.7 are set forth below.

Comment: Commenters on this provision overwhelmingly supported the Coordinator requirement at § 92.7. A number of supportive commenters indicated that civil rights violations often occur due to ignorance, neglect, and administrative indifference, and Coordinators will equip providers with critical civil rights knowledge and the ability to recognize and adequately care for patients at risk for poor health outcomes. Other commenters similarly emphasized that the Coordinator requirement will equip covered entities with an internal resource dedicated to section 1557 implementation and compliance, and that this is especially critical for small covered entities and covered entities in rural communities. Commenters cited a number of other reasons for their support of the Coordinator requirement, including that having a Coordinator will help covered entities proactively protect civil rights; will provide central points of contact for language access; and will allow covered entities and OCR to better identify patterns or practices of discrimination, which will aid covered entities in delivering effective and efficient care.

One commenter expressed concern about the possibility that Coordinators evolve and become ineffective by privileging the institutions they serve rather than appropriately conducting thorough investigations of grievances. Relatedly, another commenter recommended that OCR revise § 92.7 to require covered entities' Coordinators to be independently minded or independent from the covered entity to ensure impartiality and transparency and to require that Coordinators be able to work independently.

Many of these commenters cited the COVID-19 Public Health Emergency as a reason for their support of the Coordinator requirement. Specifically, they stated that the health outcomes resulting from the COVID-19 pandemic highlighted covered entities' ignorance of civil rights regulations with respect to individuals from marginalized communities.

Response: We agree with commenters regarding the myriad benefits of the Coordinator requirement, particularly with regard to increasing covered entities' ability to proactively prevent discrimination before it happens and hopefully more thoroughly address it when it does. Coordinators are expected to perform their impartially, which will also benefit covered entities through ensuring compliance with section 1557.

OCR appreciates commenters' concerns that Coordinators be sufficiently independent from a covered entity to ensure impartiality and transparency. We note that a covered entity may run the risk of noncompliance with section 1557 if an investigation reveals that its Coordinator did not carry out their obligations under section 1557 in an impartial manner. By having a Coordinator, with specific compliance responsibilities, OCR expects that covered entities will be cognizant of the importance of compliance with civil rights requirements, including in times of public health emergencies or other crises.

Comment: Other commenters opposed the Coordinator requirement, contending that it will increase the burdens covered entities will face.

One commenter reiterated the 2020 Rule's reasoning for eliminating the Coordinator requirement by stating that regulations for underlying civil rights statutes requiring coordinators is sufficient for section 1557 enforcement. Another commenter stated covered entities can meet section 1557 compliance obligations without a Coordinator. Yet another commenter recommended that OCR instead encourage practices to adopt a collaborative approach where all staff take an active role in ensuring nondiscrimination.

Response: The role of the Coordinator is to promote effective and efficient implementation of section 1557 and the part, and in so doing decrease compliance inefficiencies and promote meaningful investigations of allegations of potential civil rights violations.

OCR remains confident that the benefits to a covered entity and the public of the Coordinator requirement outweigh any potential burdens. Time spent coordinating a covered entity's section 1557 compliance program is an investment that will likely result in improved, nondiscriminatory health care delivery and saving resources otherwise spent responding to potential OCR investigations and private litigation. Even if a covered entity is subject to a civil rights complaint or litigation, its Coordinator's presence and active coordination efforts may enable the covered entity to more quickly resolve a complaint or litigation.

This rule addresses the confusion that the 2020 Rule creates surrounding the extent to which covered entities were required to maintain a Coordinator for purposes of section 1557 compliance. The 2020 Rule does not clarify, for example, whether a covered entity's existing section 504 coordinator—whose role relates to ensuring a recipient's efforts to comply section 504 alone, per 45 CFR 84.7—must also ensure the covered entity's compliance with section 1557's prohibition of discrimination based on race, color, national origin, age, or sex. OCR is providing for a specific Section 1557 Coordinator, rather than relying on the requirements found in the implementing regulations for the referenced statutes, to resolve any confusion as to covered entities' responsibilities.

Comment: Some commenters requested that OCR clarify that Coordinators are responsible for covered entities' internal section 1557 oversight and that covered entities may have other staff members implement various Coordinator activities. These commenters recommended that OCR revise § 92.7(b) to add “or designee” after “Section 1557 Coordinator” to confirm that one or more staff can assist the Coordinator with the enumerated Coordinator responsibilities. Some commenters requested clarity about whether a covered entity's Coordinator can also serve in other capacities within the covered entity's organization, and whether the Coordinator requirement obligates covered entities to hire a new employee to serve as a Coordinator, and if so, whether the job description must list all of the Coordinator responsibilities enumerated at § 92.7(b).

Response: Section 92.7(a) expressly states that a covered entity may assign one or more designees to assist the Coordinator in carrying out their responsibilities. However, the Coordinator must retain ultimate oversight for ensuring the covered entity's compliance with this part. In general, it is the covered entity's prerogative to designate any qualified individual to serve as its Coordinator. A covered entity does not need to hire a new employee for the role, and the Coordinator may serve in other capacities and have responsibilities in addition to their Coordinator responsibilities at § 92.7(b); so long as those responsibilities do not create a conflict of interest or otherwise prevent the Coordinator from effectively carrying out their responsibilities.

Comment: Some commenters recommended that OCR not require covered entities to list a Coordinator's name and contact information in their publicly available Notice of Nondiscrimination because of the constant need to update Coordinators' Start Printed Page 37552 names and contact information due to turnover and to avoid potential harassment from section 1557 opponents. Instead, these commenters requested that OCR allow covered entities to list the Section 1557 Coordinator job title instead of an individual's name.

Response: OCR appreciates the challenges associated with updating specific contact information; for this reason, nothing in § 92.8 (Policies and procedures) or § 92.10 (Notice of nondiscrimination) require covered entities to include a Coordinator's name. As proposed, and finalized, §§ 92.8(b) and 92.10(a)(1)(v) both require “contact information” for the Coordinator; providing the job title rather than an individual's name is sufficient to meet this requirement. However, contact information in the form of a phone number, email address, and mailing address must also be provided. A covered entity may establish a general phone number, email address, and/or mailing address to meet this requirement. Absent this information, individuals who need to reach the Coordinator will have no knowledge of how to do so.

While this rule does not apply to employment practices, as discussed in § 92.2(b), employees of covered entities remain protected against retaliation as provided in §§ 92.303 and 92.304. If a covered entity's staff is harassing the Coordinator because of the Coordinator's job responsibilities, the covered entity should take appropriate measures to address the harassment, and, if the harassment is based on one or more characteristics protected by the Federal laws enforced by the EEOC, the Coordinator may file a charge of discrimination with the EEOC at https://www.eeoc.gov/​filing-charge-discrimination .^[70] If staff, including a covered entity's Coordinator, are being threatened by other covered entity staff or by individuals external to the covered entity, we strongly encourage reporting these threats to the FBI at 1-800-225-5324 or via www.fbi.gov/​tips.

Comment: One commenter requested that OCR clarify whether a large health system made up of several covered entities can have a single Coordinator for the entire health system or whether each covered entity needs to have its own Coordinator. Another commenter stated that it is impossible for one Coordinator to oversee section 1557 compliance for an entire large health care system, with another suggesting that there should be at least one Coordinator for every 250 employees for covered entities with 500 or more employees.

Response: In order to provide covered entities with flexibility, OCR clarifies that large health systems may customize their Coordinator and designee configurations as long as each individual covered entity has either a Coordinator or designee responsible for section 1557 compliance. Because a covered entity is better positioned to determine how to ensure that the coordinator(s) can effectively perform all of their duties, we decline to revise the Coordinator requirement so that a covered entity is required to designate one Coordinator for every 250 employees.

Comment: A significant number of commenters recommended that all covered entities, regardless of size, have a Coordinator because ensuring section 1557 compliance is integral to providing nondiscriminatory health care services. Another commenter noted that the requirement aligns with the Joint Commission's recent standards requiring accredited hospitals and similar facilities to designate an individual to lead activities to reduce health disparities.

Several commenters stated that the 15-employee threshold is arbitrary, arcane, and inconsistent with protecting civil rights to the maximum extent possible. Others stated the position is critical for smaller covered entities that provide services to individuals with disabilities, particularly in rural and low-income communities, and for covered entities that provide long-term services and supports to older adults and people with disabilities who use home and community-based services. Others referenced that smaller covered entities include mental health providers, social workers, psychologists, counselors, and family and marriage therapists.

One commenter suggested that covered entities with fewer than 15 employees could still voluntarily designate a Coordinator.

Response: OCR appreciates comments received regarding the application of the Coordinator provision. While all covered entities, regardless of size, would benefit from having a dedicated Coordinator on staff, we decline to extend the requirement to all covered entities beyond those with 15 or more employees, in an effort to reduce unnecessary or counterproductive administrative obligations on small providers. OCR does not find this limitation to be arbitrary, as it is consistent with section 504's coordinator requirement, 45 CFR 84.7(a), and was also included in the 2016 Rule at former § 92.7. We note that covered entities with fewer than 15 employees retain the option of designating a Coordinator.

Comment: Other commenters thought the 15-employee threshold was appropriate, and that applying the requirement to smaller entities would result in burdens and costs for small and solo practices. Another commenter recommended increasing the employee threshold so that only covered entities with 50 or more employees be required to designate a Coordinator. Another commenter recommended that covered entities that fall within the Small Business Association's (SBA) classification ^[71] of a small business not be required to designate a Coordinator. Another commenter recommended that the Coordinator requirement be removed altogether.

Response: The Coordinator requirement is a vital step in encouraging proactive civil rights compliance; therefore, OCR declines to remove this provision. We also decline to increase the employee threshold for the Coordinator requirement to 50 or more employees. Though the coordinator requirement in title II of the ADA is limited to public entities with 50 or more employees, 28 CFR 35.107, the 15-employee threshold in section 504 is more appropriate for section 1557. Section 504 covered entities are more analogous to section 1557 covered entities given that they are recipients of Federal financial assistance of all sizes; ADA title II covered entities, however, are all State or local governments. For similar reasons, we believe that that the SBA classification of a small business—which was set in a very different context serving very different purposes—is inappropriate for this rule.

Comment: Some commenters requested additional clarity about the 15-employee threshold. For example, commenters asked whether part-time, contractor, and sub-contractor employees would count toward a covered entity's employee total or if Start Printed Page 37553 only full-time employees would count. One commenter suggested that, without this clarification, some covered entities will engage in hiring and human resources practices that undermine and abuse the 15-employee threshold. Another commenter also sought to clarify whether only clinical staff should count toward the 15-employee threshold and whether administrative staff should count as well.

Response: With respect to the employees who will count towards the 15 or more-employee threshold, OCR will consider the total number of individuals employed by a covered entity. This includes full-time and part-time employees and independent contractors. All employees, regardless of job classification ( e.g., clinical versus clerical), will count toward the threshold. We intend for this clarification to reduce concerns that the 15-employee threshold may lead to questionable employment practices.

Comment: One commenter indicated that the Coordinator requirement implicates religiously affiliated covered entities' authority to hire people who share their religious beliefs because requiring religiously affiliated covered entities to have a Coordinator may compromise the religiously affiliated covered entity's religious beliefs if its Coordinator has fundamentally different beliefs or viewpoints.

Response: Nothing in the regulatory text requires a covered entity to designate a Coordinator with a particular viewpoint or particular beliefs. No part of this final rule prevents a religiously affiliated recipient from designating or hiring an employee who shares the entity's religious beliefs as its Coordinator, provided that the individual is qualified to effectively and impartially perform the role required by the regulation. In addition, where title VII applies to a recipient's employment and hiring decisions, section 1557 does not interfere or otherwise conflict with requirements or protections afforded under title VII.

Comment: Several commenters supported the 2022 NPRM's inclusion of an enumerated list of Coordinator responsibilities at § 92.7(b). Many of these commenters appreciate the flexibility for covered entities to spread or delegate responsibilities to one or more designees within a covered entity's organization. Some commenters requested that OCR consider revising § 92.7(b) to add an additional responsibility that Coordinators coordinate with other covered entities, as necessary, to ensure that individuals who are interacting with multiple entities receive the required language assistance services and/or auxiliary aids and services. A different commenter felt that the enumerated list of Coordinator responsibilities at § 92.7(b) is too prescriptive and recommended that OCR allow each covered entity the opportunity to determine their Coordinator's responsibilities.

Response: The responsibilities enumerated at § 92.7(b) provide a baseline for expected duties while allowing covered entities the flexibility, discretion, and ability to structure responsibility for such duties to their Coordinator(s) or designee(s). A covered entity may assign duties beyond those enumerated at § 92.7(b), at its discretion.

With respect to situations where two covered entities are interacting with the same individual with LEP, individual with a disability, or individual with a disability with LEP, both covered entities are responsible for ensuring that individuals receive the appropriate language assistance services and/or auxiliary aids and services required by this rule under §§ 92.201 and 92.202. Some agencies may find that coordination between their Section 1557 Coordinators will help to more effectively meet the needs of these individuals, but OCR declines to implement a requirement to this effect as each covered entity has an obligation under this part regardless of what services they believe another covered entity may be providing.

Comment: Another commenter recommended that a covered entity's Coordinator not handle section 1557 grievances given that a covered entity may have an existing grievance collection point, which allows it to quickly address grievances through existing structures. A different commenter recommended that OCR clarify that a covered entity can assign Coordinator responsibilities to a group or division instead of one or more specific individuals because organizations may already have individuals specifically trained and responsible for ensuring nondiscrimination.

Response: These regulations do not prohibit a Coordinator from working within existing organizational structures that receive and investigate grievances or perform other Coordinator responsibilities identified in § 92.7(b). As discussed above, this provision provides a covered entity wide latitude to designate one or more Coordinator(s) and to assign one or more designee(s) to assist the Coordinator with their responsibilities, including collecting and addressing grievances. A covered entity may also assign Coordinator responsibilities to a group or division, provided that the covered entity identifies an individual Coordinator who retains ultimate oversight for coordinating section 1557 compliance.

Comment: One commenter recommended that OCR make clear that, when performing their grievance responsibilities, the Coordinator is required to collect specific data, including: alleged basis or bases of discrimination; the date the grievance was filed; the date of the alleged discriminatory action; and the grievance resolution. This commenter indicated that this data should not include individually identifying information and indicated that the covered entity, through the Coordinator, should be responsible for the privacy of the data that they collect while fulfilling their coordinator role. A different commenter recommended that OCR require Coordinators to review grievance data in order to identify potential and actual discriminatory trends.

Response: OCR appreciates the commenter's suggestion regarding the data that must be retained for each grievance. However, we decline to include these details here as the data points the commenter suggested are already in § 92.8(c)(2), which discusses the information that must be retained in grievance records. Although this final rule does not require covered entities to collect data on trends across the organization, we highly encourage all Coordinators to review grievance data to identify and address any potential and actual discriminatory trends revealed in such data. We discuss this in greater detail at § 92.8(c) (grievance procedure).

Comment: Multiple commenters requested that OCR provide training and other resources to help covered entities implement the Coordinator requirement. Some commenters requested that OCR provide (1) training for people who are new to the Coordinator role and for providers who are updating the role; (2) facts sheets to introduce section 1557 to the Coordinator and other staff throughout the organization; and (3) checklists that can be consulted and used to confirm the Coordinator's responsibilities. One commenter requested that OCR training for Coordinators include civil rights, cultural, and implicit bias training.

Response: OCR commits to serve as a resource and partner with covered entities that need help regarding their Coordinator obligations. As discussed in further detail at § 92.8 (Policies and procedures), we plan to make various resources available to assist Coordinators with their responsibilities.

Comment: One commenter asked how OCR will audit covered entities' Start Printed Page 37554 compliance with the Coordinator requirement and whether the Coordinator post will be eligible for the Federal matching rate as an administrative activity under section 1903(a)(7) of the Social Security Act.

Response: Consistent with current practice, OCR will determine a covered entity's compliance with the Coordinator requirement during complaint investigations and affirmative compliance reviews. With regard to the commenter's inquiry regarding the availability of Federal financial participation under section 1903(a)(7) of the Social Security Act, 42 U.S.C. 1396b(a)(7), OCR does not administer Medicaid and therefore this comment is outside of the scope of this rulemaking.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.7, without modification.

Policies and Procedures (§ 92.8)

At § 92.8 of the 2022 NPRM, OCR proposed requiring covered entities to develop and implement written policies and procedures that are designed to facilitate compliance with the requirements of the part. We proposed requiring each covered entity, in its health programs and activities, to adopt and implement a nondiscrimination policy, grievance procedures (for covered entities employing 15 or more persons), language access procedures, auxiliary aids and services procedures, and procedures for reasonable modifications for individuals with disabilities (collectively, “Section 1557 Policies and Procedures”).

In § 92.8(a), we proposed a general requirement for covered entities to implement written Section 1557 Policies and Procedures. The policies and procedures must include an effective date and be reasonably designed, taking into account the size, complexity, and the type of health programs or activities undertaken by a covered entity, to ensure compliance with the part.

In § 92.8(b), we proposed requiring each covered entity to implement a written nondiscrimination policy that, at minimum, provides the contact information for the Section 1557 Coordinator (if applicable) and states that the covered entity in its health programs and activities: is prohibited from unlawfully discriminating on the basis of race, color, national origin (including limited English proficiency and primary language), sex (including pregnancy, sexual orientation, gender identity, and sex characteristics), age, or disability; and provides language assistance services and appropriate auxiliary aids and services free of charge, when necessary for compliance with section 1557 or the part.

In § 92.8(c), we proposed addressing the requirements for covered entities with 15 or more employees with regard to grievance procedures and recordkeeping in their health programs and activities, including ensuring that the grievance procedure is accessible to individuals with LEP and individuals with disabilities.

In § 92.8(c)(1), we proposed requiring that covered entities with 15 or more employees establish written civil rights grievance procedures.

In § 92.8(c)(2), we proposed that a covered entity must retain records related to grievances filed with it that allege discrimination on the basis of race, color, national origin, sex, age, or disability in its health programs and activities for no less than three (3) years from the date of the filing of the grievance.

In § 92.8(c)(3), we proposed that a covered entity keep confidential the identity of an individual who has filed a grievance, except as required by law or to the extent necessary to carry out the purposes of this proposed regulation, including the conduct of any investigation.

We invited comment on the record retention requirement, particularly with regard to patient privacy concerns or concerns regarding potentially unauthorized use of information included in such records. We also sought comment on best practices for record retention of grievance procedures, including strategies for ensuring patient privacy.

In § 92.8(d), we proposed requiring covered entities to develop and implement written language access procedures to support compliance with requirements to take reasonable steps to provide meaningful access to individuals with LEP in their health programs and activities under proposed § 92.201.

In § 92.8(e), we proposed requiring covered entities to develop and implement written effective communication procedures to support compliance with requirements to take appropriate steps to ensure that communications in their health programs and activities with individuals with disabilities are as effective as communications with individuals without disabilities under proposed § 92.202.

In § 92.8(f), we proposed requiring covered entities to develop and implement written procedures for making reasonable modifications to their policies, practices, or procedures that allow individuals with disabilities equal opportunity to participate in their health programs and activities as required under proposed § 92.205.

In § 92.8(g), we proposed that a covered entity may combine the content of the policies and procedures required by this provision with any policies and procedures pursuant to other civil rights statutory protections if they clearly comply with section 1557 and the provisions in the part.

We sought comment on this proposed provision and whether there may be alternative measures that OCR should consider to proactively prevent discrimination, and whether they would be more or less burdensome than what was proposed. We also invited comment from all covered entities that had previously implemented or were currently implementing any of the proposed procedures; consumers who interact with covered health programs and activities; and community-based organizations that work with individuals with LEP and individuals with disabilities. We also requested comment on whether covered entities employing fewer than 15 people should be required to have a grievance procedure, including the benefits of a less formal resolution process.

The comments and our responses regarding § 92.8 are set forth below.

General Comments

Comment: Many commenters expressed support for the Section 1557 Policies and Procedures requirement at § 92.8, noting that, in their view, it will help prevent discrimination and health disparities; requires providers to proactively engage in the process of avoiding discrimination; elevates covered entities and their employees' knowledge about their section 1557 obligations; and alleviates the burden on patients to file complaints in order to trigger section 1557 compliance and enforcement. Some commenters supported the requirement because the 2020 Rule leaves requirements for policies and procedures disjointed, confusing, and ineffective.

Some commenters recommended that OCR strengthen this requirement by requiring covered entities to evaluate the effectiveness of their Section 1557 Policies and Procedures and update them when necessary to ensure consistency.

Response: Covered entities' Section 1557 Policies and Procedures should be dynamic and updated to ensure covered entities comply with changes in the law Start Printed Page 37555 and meet their section 1557 obligations. In addition, when covered entities' operations change, this may necessitate revising Section 1557 Policies and Procedures to maintain section 1557 compliance.

Accordingly, we have added § 92.8(h) to address when it is required and permissible for a covered entity to revise their Section 1557 Policies and Procedures. Section 92.8(h)(1) explains that a covered entity must review and revise its policies and procedures, as necessary, to ensure they are current and in compliance with section 1557 and this rule. Section 92.8(h)(2) states that a covered entity may change its policies and procedures at any time, provided that the changed policies comply with section 1557 and the part.

Comment: Some commenters who opposed this requirement cited covered entities' existing compliance burdens and the resources needed to draft Section 1557 Policies and Procedures. Some commenters requested that, if OCR maintains the requirement in the final rule, OCR make template Section 1557 Policies and Procedures available for covered entities to use and tailor to their organizations as far in advance of the final rule's effective date as possible.

One commenter stated that existing Federal and State regulations prevent covered entities from focusing on high-quality care, and that this requirement is an unfunded mandate. One commenter recommended that OCR should continue previously permitted flexibility and allow covered entities to develop Section 1557 Policies and Procedures voluntarily.

Response: To assist covered entities' compliance with this requirement, OCR has developed Section 1557 Policies and Procedures templates that are available on OCR's website at www.hhs.gov/​1557, which are designed to assist covered entities in tailoring their own Section 1557 Policies and Procedures. We reiterate the requirement that a covered entity's Section 1557 Policies and Procedures must be reasonably designed, take into account a covered entity's size, complexity, and the type of health programs or activities provided. A covered entity should view these templates as a starting point for adopting and implementing Section 1557 Policies and Procedures that are specific to their health programs and activities. The templates provided may be insufficient for large covered entities given the range in complexity and structure of those entities, and entities must ensure that their Section 1557 Policies and Procedures reflect the appropriate scope.

Comment: Some commenters recommended that OCR not require covered entities to identify the names of their respective Coordinators in their Section 1557 Policies and Procedures required by § 92.8(b), (d), (e), and (f) because high employee turnover may make coordinators' names obsolete and require constant changes.

Response: OCR notes that nothing in § 92.8 requires a covered entity to identify the Coordinator by name; rather, § 92.8(b), (d), (e), and (f) require the Coordinator's current contact information. The referenced provisions require sufficient information for an individual who needs assistance in implementing the procedures to reach the Coordinator. Thus, a covered entity could choose to list the position title with a phone number, email address, and mailing address.

Comment: One commenter requested that OCR clarify, especially with respect to large health systems (such as hospitals, clinics, home care entities, and home medical equipment retail settings), the regulatory language related to scalability.

Response: OCR recognizes that covered entities—including not only recipients, but also the Department and title I entities—need flexibility when developing and implementing their Section 1557 Policies and Procedures. A covered entity should consider its size, capabilities, the costs of specific measures, the operational impact, and the composition of the patient populations they serve in deciding the appropriate scale of their Section 1557 Policies and Procedures. Thus, OCR expects the scope and detail of a covered entity's Section 1557 Policies and Procedures to vary accordingly.

Comment: Some commenters requested that OCR include additional required policies and procedures, such as policies and procedures regarding service animals, protecting civil rights in public health emergencies, assessing the competency of bilingual/multilingual staff, and telehealth. Specifically, one commenter recommended requiring a telehealth procedure designed to assist covered entity employees communicate with patients before, during, and after telehealth visits, and that this telehealth procedure could address pre-appointment telehealth screenings to ensure that patients have the necessary equipment or technology for their appointments and to determine whether the patient has the requisite technological skills to participate in a telehealth session. The proposed telehealth procedure would require covered entities to provide telehealth training resources for patients who lack skills or familiarity with telehealth prior to their appointments. Other commenters recommended that covered entities' procedures ensure accessibility for individuals with physical and/or behavioral health disabilities and specifically comply with the U.S. Access Board's Standards for Accessible Medical Diagnostic Equipment. 82 FR 2810 (Jan. 9, 2017).

Response: OCR recognizes the benefit of policies and procedures to support civil rights compliance. However, we recognize that developing and implementing such policies and procedures is not without an initial burden on the covered entities, and the continued—though much diminished—effort of maintaining the procedures and employee familiarity with such procedures. For that reason, we decline to require additional policies and procedures at this time. However, covered entities are encouraged to develop and implement policies and procedures related to service animals, protecting civil rights during public health emergencies, assessing bilingual and multilingual staff members' competency, nondiscriminatory provision of telehealth,^[72] accessible medical equipment, or any other situation they choose in order to ensure compliance with section 1557. For more about section 1557's accessibility requirements, please refer to our discussion for § 92.204, which requires covered entities to make their buildings and facilities accessible to individuals with disabilities. In addition, please see the discussion of medical diagnostic equipment under § 92.207. Please also see the discussion of § 92.211 related to nondiscrimination in the delivery of health programs and activities through telehealth services.

Summary of UUegulatory changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the policies and procedures requirement provision at § 92.8 as proposed, with modifications. We have added a paragraph (h) that explains that a covered entity must review and revise its policies and procedures, as necessary, to ensure they are current and in compliance with section 1557 and this rule and that a covered entity Start Printed Page 37556 may change its policies and procedures at any time, provided that the changed policies comply with section 1557 and this rule.

Nondiscrimination Policy

Comment: Many commenters supported the Nondiscrimination Policy at proposed § 92.8(b). Some commenters recommended that OCR revise the language in this Policy so that the description of prohibited sex discrimination is consistent with the description of sex discrimination included in § 92.101 ( i.e., revise to include sex stereotypes and pregnancy or related conditions). Some of these commenters further recommended that OCR also specify that “pregnancy or related conditions” includes termination of pregnancy. Other commenters requested that OCR further revise § 92.8(b)'s reference to sex discrimination and make a corresponding revision to § 92.101(a)(2) by adding “transgender status” to the description of sex discrimination for both provisions.

Response: OCR appreciates the need for consistency across the regulation, and to ensure that the public is aware of the various types of discrimination included under the umbrella of sex discrimination. We clarify that a Nondiscrimination Policy's prohibition of sex discrimination encompasses protections afforded for various types of sex discrimination such as pregnancy, including termination of pregnancy or related conditions, and we have revised the parenthetical in § 92.8(b) to explain that this provision's reference to sex discrimination is consistent with the various types of sex discrimination described at § 92.101(a)(2), which includes “gender identity.” We decline to add “transgender status” to the regulatory text, as the term “gender identity” necessarily encompasses “transgender status” and these terms are often used interchangeably.^[73]

At the same time, we want to emphasize that the ACA itself provides that “[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.” 42 U.S.C. 18023(c)(2)(A). HHS will comply with this provision.^[74] For further discussion regarding what constitutes sex discrimination, including the application of religious freedom and conscience protections in this context, please see the discussion at § 92.101(a)(2).

Comment: One commenter expressed opposition to § 92.8(b) because it would increase paperwork without benefiting or improving the quality of care.

Response: As we noted above, many commenters, some of which are providers and professional medical associations, support the requirement to have a Nondiscrimination Policy. Peer-reviewed medical publications acknowledge that a health care organization's written policies and procedures can improve quality of care and mitigate the legal risk of causing patient harm.^[75] Indeed, research suggests that the mere existence of policies that prohibit discrimination helps reduce health and other inequities.^[76] Thus, we disagree with the commenter's contention that § 92.8(b) increases paperwork without benefitting or improving quality of care particularly for individuals who belong to communities with a history of experiencing discrimination in health care settings.

Comment: A few commenters expressed First Amendment concerns related to the overarching Section 1557 Policies and Procedures requirement, particularly the Nondiscrimination Policy requirement. One of these commenters recommended that, with respect to the Section 1557 Policy and Procedures requirement, OCR should clarify that covered entities retain free speech protections to the extent that sex discrimination does not result if a covered entity acknowledges a patient's sex assigned at birth. An organizational commenter stated that the Nondiscrimination Policy is problematic under the First Amendment because requiring a covered entity to state that it does not discriminate on the bases of pregnancy, sexual orientation, gender identity, and sex characteristics constrains freedom of speech and freedom of association.

Response: OCR acknowledges the comments regarding protections on the basis of sex, particularly as they relate to nondiscrimination on the basis of pregnancy or related conditions, sexual orientation, and gender identity. As noted above, we have revised § 92.8(b) by removing descriptions of sex discrimination and by cross-referencing § 92.101(a)(2) and that provision's description of sex discrimination. Thus, a covered entity's Nondiscrimination Policy need not explicitly include the various forms of prohibited sex discrimination to address any potential First Amendment concern. However, we emphasize that these concerns do not negate a covered entity's obligation to implement Section 1557 Policies and Procedures.

We also note here that we have amended the regulatory text to add, as a best practice towards compliance, that a recipient's Nondiscrimination Policy reflect assurance of exemptions that have been triggered or that have been granted to that recipient under § 92.302.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Nondiscrimination Policy requirement at § 92.8(b) as proposed, with modifications. We are revising § 92.8(b)(1) to adjust the explanatory parenthetical for sex in the Nondiscrimination Policy to state “consistent with the scope of sex discrimination described at § 92.101(a)(2).” We are revising § 92.8(b) to add paragraph (b)(2) that states, “OCR considers it a best practice toward achieving compliance for a covered Start Printed Page 37557 entity to provide information that it has been granted a temporary exemption or granted an assurance of exemption under § 92.302(b) in the nondiscrimination policy required by paragraph (b)(1) of this section.”

Grievance Procedures

Comment: In general, commenters supported the grievance procedures requirement at § 92.8(c), including because allowing patients to voice concerns to providers builds trust between patients and providers.

Response: OCR's enforcement experience reveals that grievance procedures help covered entities lower compliance costs and provide covered entities the opportunity to resolve grievances—through direct communication with the individual raising the grievance—in the quickest possible manner without OCR's involvement.

Comment: Some commenters recommended that OCR require covered entities to adjudicate grievances quickly, and some of these commenters specifically requested that OCR add timeframes by which section 1557 grievances must be both acknowledged and resolved because covered entities may either belatedly or never acknowledge a complaint or take longer than perceived as necessary to resolve grievances. Others requested that OCR define “prompt and equitable” resolution, with one stating that “equitable” is a subjective construct and suggested that OCR consider requiring covered entities to resolve grievances by affording the aggrieved individual appropriate access to the health program or activity at issue. Relatedly, another commenter asked that OCR consider differentiating between pretreatment grievances and other grievances, because denials of care and coverage can result in the postponement or foregoing of care altogether and can require patients to wait for the resolution of a grievance before seeking care from an alternate provider.

Response: We appreciate these commenters' desire for additional specificity regarding what is meant by “prompt and equitable” resolution of a grievance. This terminology is consistent with grievance procedures requirements found in the Department's section 504 and title IX regulations at 45 CFR 84.7(b) and 86.8(b), respectively.

Imposing a single timeframe by which a covered entity must resolve a grievance does not account for the fact that covered entities vary in size, resources, and capabilities, and so one timeframe may not be appropriate for all entities. Multiple factors may impact the length of time required to evaluate and resolve a particular grievance and to ensure a fair process and reliable outcome, including the nature of the grievance. This is balanced by the fact that prompt resolution of complaints is necessary to further section 1557's nondiscrimination objective. We encourage individuals to file complaints with OCR if they have filed a grievance that they do not believe has been resolved in a prompt and equitable manner. OCR's investigation of such a complaint may determine whether a covered entity's grievances procedures truly provide for prompt and equitable resolutions, and if they do not, OCR may seek corrective actions from the covered entity. For these reasons, we decline to add timeframes within which covered entities are required to address grievances, and we decline to define the term “prompt and equitable.”

Comment: Some commenters recommended that OCR require covered entities to notify individuals of the ability to file a grievance. Other commenters requested that OCR revise § 92.8(c) to require a covered entity's process for filing grievances be simple, not burdensome, and accessible to individuals with LEP and individuals with disabilities.

Response: To the extent covered entities are required to have grievance procedures, covered entities are also required to include information about the availability of their grievance procedures and how to file a grievance in their Notice of Nondiscrimination, per § 92.10(a)(1)(vi). All covered entities, regardless of size, must also include information in the Notice of Nondiscrimination on how to file a discrimination complaint with OCR, per § 92.10(a)(1)(vii).

In addition, the grievance process must be accessible to individuals with LEP and individuals with disabilities, consistent with section 1557 and this regulation. If an individual finds that a covered entity's grievance process is generally overly burdensome to the point it is ineffective or nonexistent and thus hindering the prompt and equitable resolution of grievances, we recommend the individual file a complaint with OCR.

Comment: Many commenters on this provision recommended that OCR require all covered entities (not just those with 15 or more employees) to have grievance procedures, while others either requested that OCR maintain the 15-employee threshold or eliminate the requirement altogether.

Commenters in support of eliminating the 15-employee threshold contended that a covered entity's size does not protect patients from discrimination and the threshold is inequitable because it deprives patients of smaller covered entities the opportunity to directly engage with the covered entity to address alleged discrimination. According to commenters, individuals with disabilities face significant barriers to care when seeking and receiving services from smaller covered entities, and the 15-employee threshold unjustly deprives individuals with disabilities of the opportunity to address these barriers through grievances.

Further, commenters remarked that regulatory carve outs and distinctions are confusing and difficult for both covered entities and patients when determining applicable requirements and protections. Commenters expressed concern that individuals from marginalized communities would be confused about why they could not submit a grievance with a covered entity with fewer than 15 employees simply due to the size of the covered entity, when other requirements in the rule apply regardless of covered entity size.

Commenters also raised the following issues countering inclusion of a 15-employee threshold: the statutory text of section 1557 is not so limited; the limitation is inconsistent with expanding section 1557's application; an individual should have the ability to address discrimination in the first instance directly to the covered entity; and a covered entity with fewer than 15 employees that has grievance procedures will be able to resolve discrimination complaints more promptly at an earlier stage without formal OCR investigation.

Citing the burden on smaller covered entities, some commenters requested that OCR maintain the grievance procedures requirement only for covered entities with at least 15 employees, eliminate the procedures altogether or utilize the SBA's definition of small business.

Response: We appreciate commenters' concerns about the 15-employee threshold and recognize that individuals are not immune from experiencing discrimination when interacting with smaller covered entities. However, OCR declines to apply this requirement to all covered entities and note that this approach is consistent with OCR's section 504 regulation, which similarly limits the grievance procedure requirement. See45 CFR 84.7(a). Individuals remain able to file complaints with OCR when they experience discrimination in health programs and activities and may also raise concerns to smaller covered Start Printed Page 37558 entities outside of a formal grievance process.

Given the benefits of having grievance procedures, we encourage smaller covered entities to voluntarily implement such procedures, which may help them more meaningfully engage with all individuals, including members of underserved communities, and better identify potential barriers to accessing their health programs and activities.

Comment: Some commenters pointed to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) as precedent and demonstrable evidence that the Department believes providers of all sizes have the ability to comply with a Federal requirement to implement a process for handling complaints. These commenters suggested that all HIPAA-covered entities, including those with fewer than 15 employees, have experience implementing a process for receiving, handling, and investigating privacy complaints, which these covered entities can modify or replicate, if necessary, to include section 1557 discrimination grievances.

Response: OCR appreciates commenters' observation that HIPAA-covered entities of all sizes have experience implementing a complaint process. However, we are unpersuaded that the potential burden to smaller covered entities with existing HIPAA complaint processes would be minimal because these entities would need to revise their existing policies, train relevant staff, and process civil rights-related grievances in addition to processing HIPAA-related complaints. This is similar to our position in response to comments received in response to the 2015 NPRM. 81 FR 31395. Nothing in this rule prohibits entities of fewer than 15 employees from voluntarily creating a grievance process.

Comment: In support of requiring all covered entities to have grievance procedures, commenters suggested that covered entities could have less extensive or detailed grievance procedures, and that such a procedure would not need to involve significant staff or resources. These commenters recommended that OCR develop model grievance procedures for smaller covered entities to help them comply with the grievance procedures requirement.

Response: To assist all covered entities—including those with fewer than 15 employees that may wish to voluntarily implement a grievance procedure—we have made available sample grievance procedures on OCR's website at www.hhs.gov/​1557. We note that the sample grievance procedure available on OCR's website is more appropriate for smaller covered entities, and we remind covered entities that the rule's general Section 1557 Policies and Procedures requirement is founded on the principle of scalability. Accordingly, the sample grievance procedure on our website may not be adequate for a larger covered entity or health system made up of several covered entities.

Comment: Many commenters supported the record retention requirement at § 92.8(c)(2). Under this provision, we proposed that covered entities must retain records for a minimum of three (3) calendar years, and each record must include the name and contact information of the complainant, the alleged discriminatory action and alleged basis or bases of discrimination, the date the grievance was filed, the grievance resolution, and any pertinent information.

Some commenters expressed that this requirement will help covered entities identify potential patterns and practices of discrimination of which they may not have otherwise been aware. Other commenters who supported this requirement expressed concern about patient privacy and recommended that OCR require covered entities to deidentify information related to the grievance during the retention period.

Response: We appreciate commenters' support for this new provision and recognize the importance of ensuring patient privacy related to recordkeeping. Section 92.8(c)(3) requires covered entities to keep confidential the identity of the individual who submits a grievance, subject to limited exceptions. We decline to revise the records retention requirement to require covered entities to deidentify that information related to the grievance.

Many section 1557 covered entities must also comply with the HIPAA Privacy and Security Rules, which requires HIPAA covered entities to protect and secure all protected health information that a covered entity or business associate creates, receives, maintains, or transmits. If a covered entity discloses an individual's protected health information in violation of the HIPAA Rules, then the covered entity is subject to OCR's HIPAA enforcement measures.^[77] If a section 1557 covered entity maintains grievance records beyond three (3) calendar years, the covered entity may deidentify the information after the records retention period has elapsed. Even where a section 1557 covered entity is not subject to HIPAA, that section 1557 entity must still comply with all applicable Federal and State privacy laws.

Comment: One commenter requested that OCR revise § 92.8(c)(2) so that a covered entity be required to retain only “actionable” grievances because large, covered entities may receive grievances that are not related to section 1557's protections. This commenter gave an example that a complaint may be employment-related, and therefore § 92.8(c)(2) should not require a covered entity to retain such a grievance.

Another commenter raised a similar concern and recommended that OCR completely eliminate any record retention requirement as they relate to grievances because it is difficult to know when a grievance triggers the retention requirement. This commenter requested that, if OCR retains the grievance records retention requirement, that it only apply to covered entities with 15 or more employees.

Response: Section 92.8(c)(2) applies only to covered entities that are required to have grievance procedures ( i.e., those with 15 or more employees), and this provision expressly specifies that covered entities retain grievances it receives pursuant to the grievance procedures requirement at § 92.8(c)(1) that allege discrimination on the basis of race, color, national origin, sex, age, or disability in the covered entity's health programs or activities. Thus, covered entities need not retain records pertaining to employment-related grievances or grievances that do not allege discrimination based on race, color, national origin, sex, age, or disability in the covered entity's health programs or activities. If a covered entity cannot determine whether a complaint relates to section 1557, the covered entity should contact the complainant to obtain sufficient information to either investigate the grievance or determine if the complaint should be handled under a different process. We note that a covered entity's dismissal of a grievance constitutes its resolution of the grievance.

Comment: One commenter who expressed support for the retention requirement opined that the proposed three-year retention period is less burdensome than the seven-year retention requirement applicable to most records for hospice and palliative care. Another commenter recommended that covered entities be required to retain grievance-related records permanently due to the low costs associated with maintaining these records electronically, and a covered entity could find older records useful in Start Printed Page 37559 litigation. Another commenter recommended that OCR adopt a four-year retention period to match section 1557's four-year statute of limitations ^[78] because a retention period shorter than section 1557's statute of limitations would prevent private litigants from obtaining grievance-related evidence relevant to a section 1557 claim. One commenter also recommended that OCR revise § 92.8(c)(2) so that the timeframe for covered entities to retain grievance records starts once the covered entity resolves the grievance rather than when the covered entity receives it.

Response: OCR has determined that the three-year record retention requirement strikes the appropriate balance between covered entities' burden concerns and the need for OCR to access this vital information in the course of a complaint investigation or compliance review. As stated in the 2022 NPRM, we understand that many covered entities already have a practice of retaining grievance records, and nothing in this rule prevents a covered entity from retaining records longer if they so choose. 87 FR 47849.

We appreciate commenters' recommendation that OCR specify that the retention obligation starts on the date that the covered entity resolves the grievance rather than on the date that the complainant filed the grievance, and we are revising § 92.8(c)(2) to reflect this change. Grievances take varying amounts of time to resolve, and starting the retention obligation on the date of receipt could potentially result in a covered entity disposing of records pertaining to a grievance prior to the resolution of the grievance. This change necessitates that we further revise § 92.8(c)(2) to require a covered entity's grievance records also include the date that the covered entity resolved a grievance.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Grievance Procedure requirement provision at § 92.8(c) as proposed, with modifications. We are revising § 92.8(c)(2) to explain that the grievances that a covered entity must retain are those filed pursuant to its grievance procedures required by § 92.8(c)(1) that allege discrimination based on race, color, national origin, sex, age, and disability in a covered entity's health programs or activities, and that the records include the date the grievance was resolved. We are also clarifying at § 92.8(c)(2) that the retention period for grievance procedures starts on the date the covered entity resolves the grievance.

Language Access Procedures

Comment: Most commenters on this provision expressed support for the proposed language access procedures requirement at proposed § 92.8(d). Some commenters recommended that OCR revise § 92.8(d) to make clear that a covered entity's language access obligations extend to companions of patients, beneficiaries, enrollees, and applicants.

Response: It has been OCR's practice to require covered entities to provide language assistance services for LEP companions of patients, beneficiaries, enrollees, and applicants when necessary. Rather than revising § 92.8(d), we are revising § 92.201 (Meaningful access for individuals with LEP) to codify this requirement. We discuss this further when addressing comments related to § 92.201. Because the language access procedures are intended to assist covered entities in complying with their language access obligations under § 92.201, they should ensure that companions are included.

Comment: One commenter recommended that OCR allow covered entities the flexibility to identify the process and business rules that they currently use to identify individuals with LEP, how to provide language assistance services, and how to create and store translated materials and resources. This commenter suggested that § 92.8(d) reads as if it is intended for smaller covered entities that provide language assistance services in an ad hoc manner.

Response: Section 92.8(d) applies to covered entities of all sizes, allowing flexibility for covered entities to scale their language assistance services procedures as needed. Section 92.8(d) does not restrict the manner in which a covered entity implements its language access procedures, which may include the use of pre-existing business tools that meet the necessary requirements. For example, § 92.8(d) does not dictate how covered entities' employees identify individuals with LEP or how covered entities obtain language assistance services from qualified interpreters and translators ( i.e., through contract interpreters, in-house interpreters, etc.).

Comment: Some commenters indicated that often patients with LEP have to repeat a language access intake process with every visit to a covered entity, even when they have already gone through such a process and their language access needs have been previously identified by the covered entity. To avoid this situation, commenters recommended that OCR require covered entities to note in a patient's records whether the patient needs language assistance services, and if so, the specific language and services needed.

Response: OCR understands that repeatedly having to request necessary language assistance services from the same covered entity can be frustrating and may result in wasted time or the cancellation of an appointment if the needed services are unavailable. While the commenters' suggestion for covered entities to document the specific language assistance services needs in the patient with LEP's record is a best practice that we encourage for inclusion in a covered entities' language access procedures, OCR declines to revise § 92.8(d). As drafted, the provision allows covered entities the flexibility needed to comply.

Comment: Some commenters requested that OCR revise § 92.8(d) with text: (1) directly from § 92.201 related to covered entities' obligation to provide each individual with LEP with meaningful access; and (2) that aligns with Executive Order 13166 (“Improving Access to Services for Persons with Limited English Proficiency”); ^[79] title VI ; Medicaid's commitment to enhancing access through culturally competent care as defined in 42 CFR 440.262; and the Agency for Healthcare Research and Quality's “Improving Patient Safety Systems for Patients with Limited English Proficiency” guide.^[80]

Response: Section 92.8(d) already references covered entities' obligations under § 92.201, so it is unnecessary to restate that language here. We decline to modify the provision to add language from the suggested requirements and resources, as this provision relates to covered entities' obligation under section 1557.

Comment: Many commenters sought clarity about whether the language Start Printed Page 37560 access “procedures” required by § 92.8(d) differ from documents commonly referred to as language access “plans.” Noting OCR's longstanding recognition of the benefits of having a language access plan, as expressed in the Department's “2003 Guidance to Federal Financial Assistance Recipients Regarding Title VI Prohibition Against National Origin Discrimination Affecting Limited English Proficient Persons” (HHS LEP Guidance), 68 FR 47311 (Aug. 8, 2003), many commenters recommended that OCR modify § 92.8(d) to clarify that covered entities must develop and implement a language access plan before developing language access procedures because developing effective policies and procedures require such advance planning and give covered entities clear policies to follow when seeing patients with LEP.

According to these commenters, formal language access plans require a covered entity to consider and evaluate the needs of a service area, providing a better understanding of populations, prevalence of specific language groups, language access needs, and scope of services needed to provide meaningful access. Commenters highlighted the rapid growth of pockets of individuals with LEP with distinct language and cultural conventions, including indigenous immigrant populations from Central and South America, and the changing language needs for recent arrival of refugees from Afghanistan, Ukraine, Russia, and other non-English speaking countries.

In contrast, one commenter appreciated that the Proposed Rule did not require covered entities to implement language access plans and noted that small, covered entities lack resources, including time, administrative effort, and financial resources to implement a language access plan. Citing the 2015 NPRM, the commenter stated the cost to develop a language access plan at $1,135 per small, covered entity,^[81] and recommended that OCR finalize the rule without requiring covered entities to develop and implement a language access plan.

Response: OCR appreciates commenters' emphasis on the value of language access plans, which as commenters noted, are distinct from the language access procedures required under this section. Covered entities are not explicitly required to analyze the specific populations with LEP in their service areas. However, in order to develop effective language access procedures and ensure compliance with the obligations at § 92.201, a covered entity will need to engage in some form of analysis to identify the language access needs in their service area.

For example, when finalizing a list of preferred language assistance services providers, a covered entity will need to determine which providers are most capable of meeting the language needs of the individuals with LEP within the service area. To best inform its decision-making process, a covered entity may first attempt to identify the non-English languages most spoken in the relevant service area and confirm that interpreter and translation service providers can accommodate those languages. The HHS LEP Guidance, cited by commenters, is still instructive and relevant and provides helpful information in how to develop a strategy for delivery of language assistance services. See68 FR 47313-22. Covered entities are also encouraged to use the language access planning resources provided at https://www.lep.gov/​language-access-planning or reference HHS's 2023 Language Access Plan for guidance at https://www.hhs.gov/​sites/​default/​files/​Language-Access-Plan-2023_​0.pdf.

Covered entities with language access plans are often better prepared to provide individuals with LEP with meaningful access to their health programs and activities. For covered entities that have developed, implemented, and maintained language access plans, we highly encourage those covered entities to sustain that practice and to consider modifying their plans to include the elements required by § 92.8(d), to the extent it is not already included. To the extent a covered entity's language access plan meets the requirements of § 92.8(d), a separate procedures document will not be required regardless of whether the document is referred to as a “plan” or “procedures.”

Comment: Some commenters recommended that OCR delete the requirement in § 92.8(d) for covered entities to identify the names of qualified bilingual/multilingual staff members due to employee turnover, with one commenter also requesting that OCR eliminate the requirement to maintain a list and location of electronic and written translated materials because such a requirement would be an onerous, inefficient use of time due to frequent changes to translated materials. Another commenter indicated that these requirements are especially difficult for large, covered entities, and that health insurance issuers in particular should have the option to provide business rules and rationale with respect to how and where they store documents rather than create a duplicative process. This commenter also recommended that OCR allow covered entities to articulate the process for accessing language services and contact information for the covered entity's department or functional group responsible for translations.

Response: OCR acknowledges that covered entities may need to periodically revise their language access procedures to reflect changes to qualified bilingual/multilingual staff; however, these staff members play a critical role in the delivery of timely language assistance services and therefore it is imperative that employees be able to identify qualified bilingual/multilingual staff members as quickly as possible through the use of a current directory. We decline to remove the requirement that language access procedures include a current list of qualified bilingual/multilingual staff members.

Timely and effective language assistance services are also best served by maintaining a current list of translated materials. OCR notes commenters' concerns regarding the practicality and burden of maintaining a list of the physical location of all written translated materials. For this reason, we are revising the requirement to no longer require the location of written translated materials, but only how to access electronic translated materials ( i.e., their location on a covered entity's network, intranet, or external-facing website).

Section 92.8(d) requires covered entities to include contact information for their Coordinator and how employees obtain services of qualified interpreters, translators, and multilingual/bilingual staff. This allows for covered entities to articulate the process for accessing language services; if this function has been delegated to a department or functional group, contact information for that department or functional group should be included in the language access procedures.

Comment: Some commenters recommended that the Department secure resources for small, covered entities to support their provision of language assistance services. For example, one commenter recommended that OCR contract with a telephonic interpretation service and allow small, covered entities to opt-in to using that service. Another commenter suggested that OCR partner with the U.S. Department of Education to invest in medical interpreter training for smaller language communities because investing in these communities would Start Printed Page 37561 result in higher quality health care. Another commenter requested that OCR make available sample policies and procedures; best practices for working with language assistance companies, identifying qualified (and unqualified) interpreters, and producing accurate and quality translations; and training videos.

Response: OCR appreciates these commenters' suggestions for providing resources to assist small, covered entities and, we are committed to making sample language access procedures available on our website at www.hhs.gov/​1557. However, it is not appropriate for OCR, as a Federal agency, to endorse private interpreter or translator service providers. We are also unable to provide a telephonic interpretation contract into which small, covered entities could voluntarily participate.

OCR also appreciates the importance of interpreter training for less frequently encountered languages and is committed to developing a robust health care work force. To illustrate this commitment, the Department announced a “Promoting Equitable Access to Language Services in Health and Human Services” initiative in Fall 2022, for which grants were awarded to 11 organizations to develop and test methods of informing individuals with LEP about the availability of language assistance services in health care settings.^[82]

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Language Access procedures requirement provision at § 92.8(d) as proposed, with modifications. We are revising § 92.8(d) to require language access procedures to strike the requirement to include the location of any written or electronic materials and adding a requirement to include “how to access electronic translations.” We replaced “publication date” with “date of issuance” to better account for translated materials that may be in hard copy or electronic format. We are also making one technical revision. We are replacing “limited English proficient individual” with “individual with limited English proficiency,” consistent with modifications elsewhere.

Effective Communication Procedures

Comment: Comments related to proposed § 92.8(e), regarding effective communication procedures, were similar to the language access procedures comments. Many commenters requested that OCR require covered entities to develop and implement a broad “communication access plan,” which would address effective communication and accessibility for individuals with disabilities, including individuals with disabilities who also have LEP. Commenters recommended that covered entities be required to develop communication access plans prior to developing their effective communication procedures. Some commenters suggested that a covered entity's effective communication procedures should also include how to determine the sign language an individual with a communication disability uses and whether the individual needs the services of an interpreter team, such as a certified deaf interpreter and an American Sign Language interpreter. One commenter recommended that we add a requirement for covered entities to create section 1557, ADA, and section 504 communication access plans along with the effective communication procedures requirement.

Response: Advance planning is an essential component of developing and implementing effective procedures that will ensure compliance with the obligations at § 92.202, which necessitate consideration of the various aids and services that may be required to deliver effective communication. Thus, while covered entities are not explicitly required to engage in advance planning, their ability to comply with § 92.202 will be best supported though robust procedures that are developed though a thoughtful and thorough process.

Covered entities may include more information in their respective effective communication procedures than § 92.8(e) requires, and we encourage covered entities that are already implementing communication access plans to maintain that practice. Covered entities with active communication access plans are permitted to modify such plans to include the information required by § 92.8(e); to the extent a covered entity's communication access plan meets the requirements of § 92.8(e), a separate procedures document will not be required regardless of whether the document is referred to as a “communication access plan” or “effective communication procedures.” While OCR appreciates the similarities between section 1557, section 504, and ADA's effective communication requirement, section 1557 is a distinct statute and imposing requirements for a similar procedure under the ADA and section 504 is outside the authority of this rulemaking.

Comment: One commenter requested that OCR make clear in the final rule that covered entities must implement effective communication and language access requirements in a well-coordinated, comprehensive, seamless, and equally effective manner such as through a standard operating procedure. This commenter also recommended that we inform covered entities that effective communication and language access requirements are of equal, paramount importance and closely interdependent with each other, and the commenter suggested that we issue guidance recommending effective communication and language access coordination.

Response: We agree with the commenter that effective communication and language access requirements are equally important, and effective communication and language access requirements can be interdependent, particularly when communicating with individuals with disabilities who have LEP. Though covered entities would ideally implement their effective communication and language access requirements in a well-coordinated, comprehensive, seamless, and equally effective manner, we decline to revise either paragraph (d) or (e) of § 92.8 or include any additional regulatory provisions imposing such standards on covered entities, in part, because such standards would be difficult to objectively measure.

Comment: Another commenter recommended that we revise § 92.8(e) to require covered entities' effective communication procedures include information about how covered entities will assess staff members' competency as qualified interpreters or qualified readers.

Response: We discuss assessment of interpreters at § 92.4; because of the flexibility allowed by the definition regarding how a covered entity chooses to assess the qualifications of interpreters (and readers), we decline to require this information be included in the procedures.

Comment: Some commenters recommended that OCR clarify that a covered entity's effective communication procedures apply to individuals with any disability that affects an individual's ability to communicate. Further, these Start Printed Page 37562 commenters also requested that we clarify that a covered entity's auxiliary aids and services options are not limited to qualified interpreters. Another commenter recommended that we include examples of accommodations, assistance, and opportunities for individuals with speech-related disabilities in the preamble and accompanying guiding documents.

Response: Covered entities' effective communication responsibilities, further discussed at § 92.202, apply to communication with all people with disabilities and a covered entity's effective communication procedures must equip employees with the information and tools necessary to meet the needs of individuals with many different types of disabilities. These may include, but are not limited to, sensory, manual, or speaking disabilities. Covered entities' obligations to provide auxiliary aids and services extend beyond qualified interpreters. A non-exhaustive list of auxiliary aids and services can be found in the definition of “auxiliary aids and services” in § 92.4.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Effective Communication Procedures requirement provision at § 92.8(e) as proposed, without modifications.

Reasonable Modification Procedures

Comment: Many commenters supported the reasonable modification procedures requirement under proposed § 92.8(f), with some noting that many covered entities, particularly smaller covered entities, are unaware of their obligation to reasonably modify their policies and procedures when necessary to avoid discrimination on the basis of disability. Some commenters recommended that OCR proactively provide examples of the types of reasonable modifications that covered entities should consider as a means of increasing the likelihood that a covered entity's reasonable modifications procedures are adequate. One commenter urged OCR to include a statement in the final rule's preamble or guidance that a reasonable modification can include communicating in a more accessible modality ( e.g., via email), if the patient requests it.

Response: It is OCR's intent that requiring a reasonable modification procedure will address the lack of knowledge on behalf of covered entities that commenters raised, and will increase covered entities' ability to respond appropriately to requests. OCR believes this will raise overall compliance with the requirement at § 92.205 to provide reasonable modifications, and will benefit both covered entities and individuals seeking access to health programs or activities.

The vast range of potential reasonable modifications available or necessary do not lend themselves to an exhaustive list and so we are not able to include such a list here. However, many reasonable modifications involve reasonable changes in the way that an entity does something or permits an individual to do something. For example, a covered entity that generally communicates with patients via phone but receives a request from an individual with a disability to receive communication via email as a modification should generally grant that request, unless the covered entity can demonstrate that doing so would fundamentally alter the nature of the health program or activity. Other examples include allowing an individual with a disability whose disability makes attending morning appointments difficult to schedule afternoon appointments when appointments may not generally be available at that time, or allowing an individual with a disability to attend appointments via telehealth instead of in person when such modification does not fundamentally alter the nature of the service being provided. To be clear, there is no exhaustive list of what constitutes a reasonable modification, nor must covered entities develop one. Rather, covered entities are required to implement written procedures describing their process by which an individual with a disability may request a reasonable modification and how a covered entity processes and responds to such requests.

Comment: One commenter stated that a covered entity must provide reasonable modifications to an individual with a disability in the absence of an affirmative request for the modification if the covered entity had knowledge of the individual's disability or when the individual's disability is obvious. Relatedly, another commenter requested that OCR revise § 92.8(f) to reflect that an individual's failure to request a reasonable modification does not always excuse the covered entity from providing a reasonable modification if the modification does not result in a fundamental alteration.

Response: Section 92.8(f) is an administrative requirement to implement a procedure by which a reasonable modification can be requested, evaluated, and granted. However, as noted in the 2022 NPRM, failure to request a reasonable modification does not always excuse the covered entity from providing a reasonable modification to avoid discrimination on the basis of disability, as long as the modification would not result in a fundamental alteration of the health program or activity. 87 FR 47850. For example, when a covered entity has knowledge of an individual's disability and needs, or when an individual's disability and needs are obvious, a covered entity must provide modifications in the absence of a request.^[83]

Comment: Some commenters noted a common occurrence where patients with disabilities must repeatedly request the same reasonable modifications or auxiliary aids and services from the same covered entity for each visit. These commenters urged OCR to include additional language in the final rule preamble and guidance for covered entities to minimize patients' burdens of having to repeatedly notify, request, monitor, and enforce the covered entity's obligation to remove access barriers.

Response: These commenters' recommendations mirror similar comments related to experiences of patients with LEP who must repeatedly request the same language assistance services from the same covered entity. Such a practice may be inefficient and may violate the requirements of this part if they result in the delay or denial of access to a health program or activity. See discussion of § 92.201. While we strongly recommend that covered entities engage in the best practice of documenting in patients' medical records the specific reasonable modifications requested by patients with disabilities, in an effort to avoid overly prescriptive requirements we decline to revise § 92.8(f).

Comment: Commenters recommended that OCR require covered entities to appoint an individual to ensure compliance with the reasonable modification requirement. This person would: inquire whether patients need communications-related modifications; ensure such modifications are provided promptly; and monitor the patient's stay Start Printed Page 37563 to ensure the modification is provided through the duration of the entire stay. This person would also be responsible for ensuring the covered entity is otherwise complying with the requirement to provide auxiliary aids and services.

Response: This rule, at § 92.7, requires designation of a Section 1557 Coordinator by covered entities that employ 15 or more persons. The Coordinator is responsible for ensuring compliance with section 1557's requirements, including the requirement to provide auxiliary aids and services at § 92.202 and to make reasonable modifications at § 92.205. A covered entity may delegate responsibility for the actual provision of auxiliary aids and reasonable modifications, and implementation of the corresponding procedures, to an individual other than the Coordinator, such as a designee; however, we decline to require the designation of an additional employee to implement these requirements.

Comment: One commenter recommended that OCR revise the regulatory text for § 92.8(f) to substitute the modifier “reasonable” with “reasonable and appropriate.”

Response: We decline to adopt the commenter's suggested regulatory revision because “reasonable modification” is a term of art with a long history of enforcement in the disability context. We note that, consistent with similar longstanding disability rights law enforcement, we use “appropriate” in §§ 92.8(e) and 92.202(b) when describing the auxiliary aids and services that a covered entity must use to effectively communicate with individuals with disabilities.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Reasonable Modification Procedures requirement provision at § 92.8(f) as proposed, without modifications.

Training (§ 92.9)

In § 92.9, we proposed requiring covered entities to train relevant employees in their health programs and activities on their Section 1557 Policies and Procedures.

In § 92.9(a), we proposed a general requirement that covered entities train relevant employees of their health programs and activities on the Section 1557 Policies and Procedures required by proposed § 92.8.

In § 92.9(b), we specified when covered entities must train relevant employees on their Section 1557 Policies and Procedures.

In § 92.9(b)(1), we proposed that covered entities would be required to train existing relevant employees on their Section 1557 Policies and Procedures as soon as practicable, but no later than one (1) year after the effective date of the final rule.

In § 92.9(b)(2), we proposed that covered entities train new relevant employees within a reasonable period of time after they join a covered entity's workforce.

In § 92.9(b)(3), we proposed requiring covered entities to train relevant employees whose roles are affected by material changes to the covered entity's Section 1557 Policies and Procedures and any other civil rights policies or procedures the covered entity has implemented.

In § 92.9(c), we proposed requiring covered entities to contemporaneously document their employees' completion of the training required by this section in written or electronic form and maintain said documentation for no less than three (3) calendar years.

We invited comment on the experiences of covered entities in implementing training such as that required by proposed § 92.9, examples of where training made a difference in compliance, the timing of required training, whether covered entities would like the flexibility to include this required training as part of their existing annual compliance training, what types of changes would constitute a material change such that a covered entity would need to retrain staff, and how long training records must be retained. We also sought general comment on this proposal, including the effectiveness of civil rights training programs, the benefits experienced by covered entity staff and the people they serve, as well as the costs associated with the proposed training requirements. We further requested comment on whether the Section 1557 Policies and Procedures requirements and training requirements may increase the likelihood of compliance with the substantive legal requirements of section 1557.

The comments and our responses regarding § 92.9 are set forth below.

Comment: Many commenters on this provision expressed support for the training requirement and provided a range of reasons, including because the training is intended to impart knowledge and awareness of civil rights requirements and responsibilities; it will serve as an additional safeguard against discrimination and help reduce health disparities; and it will help providers connect patients to the services they need.

Commenters believed that a covered entity's staff need to understand section 1557 requirements, especially considering increased instances of employee turnover. One commenter also encouraged OCR to repeat the language in the Proposed Rule and remind covered entities that “the more thoroughly a covered entity trains its staff on its Section 1557 Policies and Procedures, the more likely it is that the covered entity will successfully provide services to individuals in a nondiscriminatory manner.” 87 FR 47850.

Some commenters said that civil rights violations occur due to lack of awareness and that training on covered entities' Section 1557 Policies and Procedures will help eliminate discrimination in health care because it promotes knowledge about how to deliver and administer health programs and activities to all patients, including patients who are members of communities that have experienced discrimination in health care services.

Some commenters suggested that OCR provide additional detail regarding the contents and delivery of the training, including by being more explicit about the nature and standards for determining adequacy of training. Conversely, one commenter recommended that OCR not make the training requirement overly prescriptive, and another asked OCR to give covered entities the authority to determine the training elements that best fit covered entities' operations.

Some commenters opposed the training requirement, referencing existing compliance burdens for providers, particularly small providers. Some commenters requested that OCR abandon the training requirement in the final rule because the requirement lacks specificity, is weak, vague, difficult to enforce, ineffective, will require more paperwork, and will confuse specialty clinics like dental offices; one commenter requested that OCR specifically exempt dermatology practices from the training requirement.

Many of the commenters that opposed the training requirement added that, if the rule is finalized as proposed, OCR should develop and provide educational materials and training resources, including materials to test trained employees' understanding of the new requirements.

Response: Section 92.9 requires covered entities to train relevant employees on their tailored Section 1557 Policies and Procedures, which will serve as a proactive safeguard against discrimination. Given this benefit, we decline to remove this Start Printed Page 37564 provision or exempt specific fields of practice from compliance with this requirement.

Recognizing the resources needed to comply with the training requirement, § 92.9 allows covered entities flexibility in designing the training they provide. However, the efficacy of the training—and its civil rights compliance benefit—will depend on a covered entity's effort in developing and conducting the training. OCR's experience with enforcing HIPAA's training requirement, 45 CFR 164.530(b), has found that employee-related violations are more limited where the required HIPAA training is routinely provided compared to where it is not. We anticipate that the section 1557 training requirement will similarly result in covered entities' employees being more aware of section 1557's discrimination prohibitions and establish a foundation by which covered entities' employees more consistently comply with nondiscrimination requirements.

With respect to the commenters' view that the training requirement will be difficult to enforce, the document retention requirement in § 92.9(c) is designed to assist with this. Moreover, OCR has been successfully enforcing HIPAA covered entities' compliance with HIPAA training requirements for more than 20 years. Through investigations, OCR evaluates covered entities' compliance with training requirements, and, when necessary, OCR ensures that a covered entity takes corrective actions to comply with said requirement.

To support compliance with this rule, OCR has made materials available on our website at www.hhs.gov/​1557; however, the training required under § 92.9 must be based on the covered entity's own policies and procedures. Thus, while OCR is providing general resources on section 1557 requirements, they must be supplemented by the covered entity to include information regarding their specific Section 1557 Policies and Procedures.

Comment: Several commenters asked OCR to clarify whether covered entities could incorporate training on their Section 1557 Policies and Procedures with existing employee and annual compliance training instead of mandating a stand-alone training. One commenter recommended that covered entities train their employees on their respective Section 1557 Policies and Procedures separately because combining this training can result in information overload if employees are trained on multiple issues at the same training.

Response: This rule does not require or prohibit covered entities from incorporating the training required under § 92.9 with pre-existing employee or annual compliance trainings. We encourage covered entities to regularly train employees on their Section 1557 Policies and Procedures, possibly alongside other annual compliance trainings, and we recommend that covered entities offer section 1557 trainings in a manner that will result in maximum knowledge retention. While the rule does not specify the frequency with which trainings must be provided, covered entities should keep in mind that they must train new employees within a reasonable period of time after the employee joins a covered entity's workforce.

Comment: We received several comments recommending that OCR clarify the term “relevant employees” who must be trained under § 92.9. Many commenters recommended that we define “relevant employees” in the final rule's definitions section at § 92.4 or within § 92.9 itself. Some commenters suggested that “relevant employees” should include: employees whose roles and responsibilities require interfacing with patients and the public; employees who make decisions about patient care and covered entity operations that impact patient care; employees in leadership and supervisory roles who make decisions that affect nondiscrimination; and employees, including C-suite leadership ( i.e., the chief executive officer, chief financial officer, chief operating officer, and chief information officer), who are responsible for executing and making decisions regarding financial assistance, patient billing, and collections. Citing the importance of interactions between covered entities and patients in the long-term services and supports context, one commenter recommended that “relevant employees” should include temporary staff who interact with the public or clients.

Response: We appreciate commenters' recommendations to define “relevant employee.” Though we described a covered entity's relevant staff who must receive the training required in the 2022 NPRM, 87 FR 47851, based on comments received, we agree that including more specificity in the final rule text will add additional clarity for covered entities. We have provided a description of “relevant employee(s)” in new § 92.9(b)(4), which that, for purposes of the section, “relevant employees” includes employees whose roles and responsibilities entail interacting with patients and members of the public; making decisions that directly or indirectly affect patients' health care, including the covered entity's executive leadership team and legal counsel; and performing tasks and making decisions that directly or indirectly affect patients' financial obligations, including billing and collections. Below, we specify that relevant employees may include temporary employees in addition to permanent employees and have revised the regulatory text accordingly.

Comment: Other commenters recommended that OCR require covered entities to train all of their employees on the covered entities' Section 1557 Policies and Procedures because all employees may encounter a patient at any time, and they should understand basic section 1557 concepts. One commenter suggested that if OCR does not require covered entities to train all of their employees, then we should broaden who we consider to be “relevant employees” because employees who do not have direct patient interaction or policy-making roles may still have section 1557 responsibilities, and many of these employees are likely to engage in incidental patient interaction during the course of their work.

Response: A covered entity has the discretion to train all of its employees to eliminate the burden of determining who the covered entity believes is and is not a relevant employee. OCR notes that an employee who makes decisions that indirectly affect patients' health care or financial obligations meets the definition for “relevant employee” at § 92.9(b)(4), and therefore a covered entity would need to train such an employee pursuant to this provision. However, given the diversity of covered entities under this rule, we decline to mandate training for all staff. For example, to do so may cause confusion for covered entities that operate a health program that is part of a larger operation ( e.g., a retail grocery store that also operates a covered pharmacy).

Comment: Some commenters recommended that, due to high staff turnover and the common practice of hiring temporary, contract, or travel staff, OCR should consider allowing temporary staff to transfer prior, completed training from one facility to another to limit burden and redundancy. These commenters also asked OCR to permit training completion documentation from one covered entity to meet the documentation requirement for another covered entity as a means to limit burden and redundancy.

Response: Section 92.9 requires a covered entity to train employees on its Start Printed Page 37565 specifically tailored Section 1557 Policies and Procedures. Thus, Covered Entity A's Section 1557 Policies and Procedures will be different from Covered Entity B's Section 1557 Policies and Procedures, and therefore a temporary employee's training on Covered Entity A's policies and procedures will not be transferable to Covered Entity B. Though temporary, contractor, and travel employees may be with an entity for a limited amount of time, that does not minimize the likelihood that these employees may still encounter an individual with LEP or an individual with a disability who may need language assistance services, effective communication, or a reasonable modification. Covered entities that hire temporary, contract, and travel employees will still need to train these employees, document such training, and maintain that documentation for the requisite amount of time. We note that this approach is consistent with OCR's enforcement of the HIPAA training requirement.

Comment: Several commenters requested that OCR require covered entities to train their employees beyond their respective Section 1557 Policies and Procedures. For example, commenters suggested that OCR require covered entities to train their employees on a variety of issues including: how to work with interpreters (in person, over the telephone, and via remote video); cultural competence, including how employees should address stigma experienced by individuals with LEP and individuals with disabilities; interacting with people with disabilities (including individuals who are deaf, hard of hearing, deafblind, and deaf-disabled); and how to competently address transgender and nonbinary patients.

Some commenters recommended that covered entities invite individuals with disabilities and other diverse backgrounds to help conduct required training because learning from people with lived experiences will help covered entities achieve effective communication and reduce biases. Another commenter recommended that OCR work with stakeholders to develop appropriate training materials.

Response: We encourage covered entities to consider investing in their workforces by providing employees additional civil rights and nondiscrimination training beyond what § 92.9 requires. For example, covered entities may deploy interactive civil rights trainings that involve questions and answers and that more actively engages participants rather than the use of training formats like pre-recorded sessions to maximize comprehension of complex civil rights concepts. OCR also acknowledges that hiring, collaborating with, or otherwise engaging individuals with disabilities and other individuals from underserved communities to provide input on training (and the underlying Section 1557 Policies and Procedures) is a best practice. Further, engaging with these same groups to provide training regarding best practices and other civil rights-related issues will give a covered entity's employees valuable perspective about the importance of delivering compassionate, inclusive, and responsive health care.

However, we decline to expand the scope of the training requirement at this time. It is our position that the training on the Section 1557 Policies and Procedures required in § 92.9 strikes the appropriate balance between covered entities' burden concerns and the need for awareness of this vital information. We note that OCR has provided a general resource on section 1557 requirements that can supplement covered entities' Section 1557 Policies and Procedures training, available at www.hhs.gov/​1557.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing § 92.9 as proposed, with modifications. We are revising § 92.9(b)(1) to specify that a covered entity must begin training its relevant employees no later than 30 days after a covered entity implements its policies and procedures required by § 92.8 and no later than 300 days after the effective date of the part. We are including a definition of “relevant employee(s),” for purposes of the section only, at § 92.9(b)(4) to provide: “for the purposes of this section `relevant employees' includes permanent and temporary employees . . . .” Lastly, we are modifying § 92.9(c) to clarify that covered entities are required to retain (rather than “maintain”) training documentation for the requisite time period.

Notice of Nondiscrimination (§ 92.10)

In § 92.10(a), we proposed requiring covered entities to provide a notice of nondiscrimination, relating to their health programs and activities, to participants, beneficiaries, enrollees, and applicants of their health programs and activities, and to members of the public (“Notice of Nondiscrimination”). Section 92.10(a)(1) proposed the required contents of the Notice of Nondiscrimination. Section 92.10(a)(2) proposed when and where covered entities must provide the Notice of Nondiscrimination.

In § 92.10(b), we proposed that a covered entity may combine the content of the notice required by § 92.10(a) of this section with the notices required by title VI, section 504, title IX, and the Age Act implementing regulations ^[84] if the combined notice clearly informs individuals of their civil rights under section 1557 and the part and meets the requirements outlined in proposed § 92.10(a)(1).

We invited comment on whether the Notice of Nondiscrimination requirement as proposed is practical, likely to be effective, and responsive to concerns raised regarding the 2016 and 2020 Rules, including the sufficiency of the contents of the notice and requirements regarding when and where covered entities must provide this notice. We sought comment on the best ways to provide an accessible notice to individuals with disabilities who may require auxiliary aids and services and the best way in which to provide the notice in a manner accessible to individuals with LEP.

The comments and our responses regarding § 92.10 are set forth below.

Comment: Many commenters strongly support the notice requirements set forth in §§ 92.10 and 92.11 (Notice of Availability), stating that such notices are needed to help people know their rights and will reduce health disparities, especially for persons with LEP and persons with disabilities. Some organizational commenters added that when the 2016 Rule's notice requirement, former 45 CFR 92.8, was removed by the 2020 Rule, many people did not know their rights, how to access interpreters or auxiliary aids and services, or how to file a grievance. Several commenters added that a clear explanation of rights and contact information for the Section 1557 Coordinator, as set forth in § 92.10(a)(1)(v), is crucial. Some disability rights groups commented that not only should the Section 1557 Coordinator's contact information be included, but also that of the ADA Coordinator.

Response: The Notice of Nondiscrimination is a critical means by which to inform individuals of their civil rights, which is part of a proactive civil rights compliance structure that functions—in part—through grievances and complaints raised by individuals. We decline to require inclusion of contact information for an ADA Start Printed Page 37566 Coordinator as this regulation is limited to section 1557; further, not all covered entities under this rule are subject to the ADA.

Comment: Various covered entities commented that the burden of the notice provisions is compounded by the complexity of having two separate notices ( i.e., the Notice of Nondiscrimination and the Notice of Availability) and the requirements to provide information in 15 languages.

Response: OCR takes seriously the concerns raised by some commenters regarding burden. In crafting the two distinct notice requirements, OCR considered comments received in response to the 2015 and 2019 NPRMs regarding the burden of a notice requirement. The provisions in the final rule reflect careful consideration of what must be included in each notice, and they include substantially more clarity regarding when and where each notice must be provided compared to the 2016 Rule.

We note that there is not a requirement that “all information” be provided in multiple languages; the requirement is that the Notice of Availability required by § 91.11 be provided in 15 non-English languages to inform individuals of the availability of language assistance services and auxiliary aids and services. Further discussion of this requirement can be found in our discussion related to the Notice of Availability (§ 92.11).

Comment: Many commenters noted that the parenthetical for sex discrimination included in proposed § 92.10(a)(1)(i) differs from the language of § 92.101(a)(2) and that it should be consistent, such that it should include sexual orientation and gender identity as well as pregnancy-related conditions.

Response: OCR appreciates the need for consistency across the regulation, and to ensure that the public is aware of the various bases for discrimination included under the umbrella of sex discrimination. As such, OCR has revised the parenthetical in § 92.10(a)(1)(i) to directly cite to § 92.101(a)(2), rather than listing examples of discrimination on the basis of sex. This is consistent with edits made to the Nondiscrimination Policy required by § 92.8(b).

Comment: Various commenters requested that OCR require any entity receiving a religious exemption to include notice of the exemption in the Notice of Nondiscrimination; they said it would be misleading to have a notice stating that the entity does not discriminate if it has been granted permission to do so in certain circumstances. They stated that the information is needed for LGBTQI+ persons seeking health care.

Response: OCR appreciates these comments. OCR declines to revise § 92.10 to impose an affirmative obligation on a recipient to identify any exemptions it has received under applicable Federal religious freedom and conscience laws. OCR additionally notes that it is a best practice for a recipient to include in its Notice of Nondiscrimination language when it has received a temporary exemption or an assurance of exemption. OCR is also subject to the Freedom of Information Act (FOIA), and information may be released to a requestor or made available for public inspection consistent with the agency's obligations under that statute and its implementing regulations.

Comment: Several commenters stated that the Notice of Nondiscrimination should be provided in the same non-English languages required by § 92.11 (Notice of Availability). Several commenters urged OCR to create a model Notice of Nondiscrimination, and to issue translations of this notice.

Response: The Notice of Nondiscrimination is among the materials that must be accompanied by a Notice of Availability, per § 92.11(c)(5)(i), which must be provided in multiple languages. While we have declined to require translation of the Notice of Nondiscrimination into a set number of languages, covered entities may still be required to provide translations when necessary to ensure meaningful access as required under § 92.201. OCR will provide a sample Notice of Nondiscrimination and may provide translations of the sample Notice of Nondiscrimination.^[85]

Comment: Some commenters argued that the requirement for when and where the Notice of Nondiscrimination must be provided, § 92.10(a)(2), is too burdensome; others commented that it eases financial burdens compared to the 2016 Rule requirements, while also ensuring that people receive information about the covered entities' civil rights obligations. Some commenters supported the requirement of prominent posting on websites, including because of the low cost, while another commenter observed that poor and rural areas sometimes cannot be reached by internet and described the need to reach historically underserved and marginalized populations.

Various commenters agreed with the proposal to provide the Notice of Nondiscrimination annually and upon request as opposed to the 2016 Rule's “significant communications” ^[86] requirement, including because the current proposal is clearer than the 2016 Rule requirement. Others stated that OCR should require the Notice of Nondiscrimination in all significant communications, such as Explanations of Benefits and patient intake forms. Some opposed annual notices as costly and annoying to patients, recommending that notice instead be upon enrollment, upon request, and prominently in health care plan documents. Others argued for using the HIPAA model, which requires notice at first point of service and then upon request only.

Response: In developing the points of contact at which a Notice of Nondiscrimination must be provided, OCR considered the concerns raised by covered entities regarding burden, consumer fatigue, and lack of clarity and specificity in prior requirements. However, we also considered comments that stated the Notice of Nondiscrimination is important to ensure that persons are informed of their civil rights and without this knowledge, including the right to language assistance services and effective communication, health disparities may continue to increase as they did during the COVID-19 pandemic. The provision is a reasonable and balanced approach that reduces the number of communications in which this essential notification is required compared to the 2016 Rule requirements,^[87] while preserving its necessary function.

While OCR appreciates that many individuals lack internet access, we note that the regulation as drafted requires posting in physical locations, as well as being provided upon request, § 92.10(a)(2)(ii) and (iv); therefore, access to the Notice of Nondiscrimination is not dependent on internet access.

Comment: Various commenters recommended that the Notice of Nondiscrimination be posted prominently where frontline employees can see it, and that it be in large sans serif font (at least 18-point font).

Response: OCR appreciates these comments and the importance of ensuring that the Notice of Nondiscrimination posted in physical Start Printed Page 37567 locations can be seen and is accessible to individuals who may have low vision. For this reason, we are finalizing § 92.10(a)(2)(iv) to require that posted notices be in a sans serif font, no smaller than 20-point font.^[88]

Comment: Several commenters argued that the Notice of Nondiscrimination and Notice of Availability must be provided together, because they are so intertwined, adding that this may also reduce the burden for covered entities.

Response: OCR appreciates this comment and directs commenters to the requirement at § 92.11(c)(5)(i), which requires that the Notice of Availability be provided with the Notice of Nondiscrimination. Covered entities may choose to integrate the Notice of Availability into its Notice of Nondiscrimination.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.10, with modifications. OCR is revising the explanatory parenthetical for sex at § 92.10(a)(1)(i) to read “consistent with the scope of sex discrimination described at § 92.101(a)(2).” We are also providing a technical revision to § 92.10(a)(1)(iii) to replace “necessary” with “a reasonable step” for consistency with the standard articulated in § 92.201(a), that “[a] covered entity must take reasonable steps to provide meaningful access to each individual with limited English proficiency (including companions with limited English proficiency) eligible to be served or likely to be directly affected by its health programs and activities.” We are revising § 92.10(a)(2)(iv) to require that posted notices be provided “in no smaller than 20-point sans serif font.” Finally, we are making a technical revision to replace “limited English proficient individual” with “individual with limited English proficiency,” consistent with modifications elsewhere.

Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11)

In § 92.11, we proposed requiring covered entities to notify the public of the availability of language assistance services and auxiliary aids and services for their health programs and activities (“Notice of Availability”).

In § 92.11(a), we proposed requiring a covered entity to provide a notice that, at minimum, states that the covered entity provides language assistance services and appropriate auxiliary aids and services free of charge in its health programs and activities, when necessary for compliance with section 1557 or the part. This notice must be provided to participants, beneficiaries, enrollees, and applicants of the covered entity's health program or activity, and members of the public.

In § 92.11(b), we proposed requiring the Notice of Availability to be provided in English and at least the 15 most common languages spoken by individuals with LEP of the relevant State or States, and in alternate formats for individuals with disabilities who require auxiliary aids and services to ensure effective communication.

In § 92.11(c), we proposed requiring the notice be provided on an annual basis to participants, beneficiaries, enrollees (including late and special enrollees), and applicants, and upon request at any time; we also proposed that the notice be provided online (when applicable) and in a clear and prominent physical location where it is reasonable to expect individuals seeking services from the health program or activity to be able to read or hear the notice. In § 92.11(c)(5), we proposed a list of specific electronic and written communications that the Notice of Availability must accompany. We invited comment as to whether requiring a Notice of Availability for all Explanation of Benefit (EOB) documents is the most appropriate approach, balancing the burden of providing Notices of Availability with all EOBs against the burdens associated with determining which EOBs must include the notice.

In § 92.11(d), we proposed alternative, optional methods by which a covered entity may be deemed in compliance with proposed § 92.11(a).

We sought comment on whether the Notice of Availability requirement as proposed is practical and responsive to concerns raised regarding the 2016 and 2020 Rules, including the sufficiency of the content of the Notice of Availability and requirements for when and where covered entities must provide the notice. We also invited comment as to whether the proposed requirements adequately address the specific concerns raised regarding the burdens associated with the 2016 Rule requirements by providing a list of specific documents with which the Notice of Availability must be provided. Additionally, we invited comment on how to best provide the Notice of Availability to individuals with disabilities to ensure they know how to request and receive relevant materials and documents in formats that meet their disability-related needs, and whether covered entities should be required to provide the Notice of Availability in sign language. Similarly, we sought comment on how to best provide the Notice of Availability to individuals with LEP, including individuals with LEP with disabilities, to ensure they know how to request and receive language assistance services and auxiliary aids and services to provide meaningful access to relevant materials and documents. We also sought comment on whether the proposed list of electronic and written communications that the Notice of Availability must accompany adequately captures the documents for which individuals with LEP and individuals with disabilities should receive the Notice of Availability. We further invited comment on the anticipated costs to covered entities of various sizes to comply with the proposed requirements.

The comments and our responses regarding § 92.11 are set forth below.

Comment: Many commenters stated that the Notice of Availability is needed because people are unaware of their rights to language assistance and auxiliary aids and services, leaving them unable to advocate for themselves and leading to health disparities. Commenters agreed that the 2019 NPRM and 2020 Rule fail to address the costs borne by participants, beneficiaries, and enrollees in the absence of notice, and the additional costs to the health care system that could result. 87 FR 47853. Many commenters provided examples of how individuals with LEP experience disparities in health care, including poor care and outcomes; higher uninsured status; lower health literacy; longer hospital stays; greater difficulty understanding health instructions; and general health care underuse. The commenters emphasized that providing Notice of Availability is the most essential element to decreasing language barriers and that with proper notice of their rights, health disparities for individuals with LEP would be reduced.

Response: OCR appreciates commenters highlighting the importance of providing individuals with LEP notice of their right to receive language assistance services, and the negative consequences of failure to do so. As discussed, OCR considered the concerns raised in response to the 2019 NPRM and 2020 Rule's failure to include a similar notice provision, as well as concerns raised in response to the 2016 Rule's notice provision. As proposed and finalized, § 92.11 provides Start Printed Page 37568 an appropriate balance between the approaches of these prior rules and is an important tool for combatting and preventing health disparities based on communication barriers.

Comment: Numerous commenters stated that the requirement to provide the Notice of Availability in 15 non-English languages was too many, providing examples of places in which they believe fewer languages were needed. For example, one provider commented that in California, 95 percent of their communications were requested in the top five languages in the State, therefore translations into the top five languages would be sufficient. Other commenters noted that smaller entities would be particularly burdened by the proposed standards. One commenter stated that requiring pediatric dental offices to offer the Notice of Availability as proposed would be burdensome and cause confusion.

Conversely, many other commenters stated that 15 languages is too few and that, under the proposed requirements, the Notice of Availability would not reach enough individuals with LEP, giving examples of language populations that would not be reached. Some commenters expressed a belief that covered entities should ensure each individual with LEP receives information about their rights in their preferred language, and that a 15-language requirement would not adequately provide that assurance. Some commenters stated that the identification of languages required should not be determined at the State level but should instead be based on the covered entity's entire program area in various states. On the other hand, some commenters expressed that the required languages should always be determined at the State level only, rather than “State or States.”

Commenters said that because OCR will provide model notices translated into the required languages, and because of the need for meaningful notice of auxiliary aids and language assistance services, the burden for providing notices in the top 15 languages per State is lessened and reasonable. A few local government commenters stated that their jurisdiction currently requires translation in more than 100 languages and recommended that this rule incorporate State and local norms.

Response: In determining the formula for the Notice of Availability translation requirement, OCR considered the 2016 Rule requirement, evaluated national- and State-level language proficiency data issued by the U.S. Census Bureau (Census), as well as potential the costs and burdens for covered entities.

The need to provide individuals with LEP notice of the availability of language assistance services remains clear and there is ample evidence that failure to provide meaningful language access in a health care setting can lead to higher costs to the health care system and have grave consequences to individuals with LEP. 87 FR 47853-54. Since the ACA was enacted, the percentage of the U.S. population with LEP (defined as those who speak English less than “very well,” as collected by the Census) has remained at roughly 10 percent.^[89]

OCR has received complaints and entities have sued the Department for rescinding the 2016 Rule's notice requirements.^[90] Litigants in Chinatown Services Center v. U.S. Department of Health & Human Services raised specific concerns that older members of the Asian American, Native Hawaiian, and Pacific Islander community, who have high rates of limited English proficiency, experienced disparities because they are not aware of their right to receive language assistance services or how to raise a concern when such services are not provided.^[91] Although one Federal court ultimately held that a plaintiff health system was not likely to prevail on the merits of its Administrative Procedure Act challenge to the 2020 Rule's repeal of the 2016 Rule's notice requirements, the court notably acknowledged that a consequence of the 2020 Rule was that the plaintiff health system provided “costlier and more difficult treatment” because patients with LEP likely received inadequate health care elsewhere and arrived to their system sicker than they otherwise may have.^[92]

OCR appreciates concerns regarding proposed § 92.11, which would require a covered entity operating in all 50 States to aggregate the populations with LEP across those States to determine the top 15 languages spoken by individuals with LEP in its service area. While this may result in a failure to reach some in-State LEP populations due to geographical variances, no single formula, including a State-level formula, will cover all individuals with LEP. However, this formula would cover a significant majority (over 93 percent) of individuals with LEP, even for covered entities that operate on a national level.^[93]

Thus, while OCR appreciates the request to increase the number of languages into which the Notice of Availability must be translated, we have determined that this would likely increase burdens while yielding additional coverage of marginally few individuals with LEP. However, covered entities are reminded that they must still take reasonable steps to provide meaningful access to all individuals with LEP, regardless of whether the individual's primary language is one of the 15 most frequently spoken non-English languages in their State or States, per § 92.201. Further, nothing in this rule prevents jurisdictions from requiring that the Notice of Availability be translated into more languages; covered entities wishing to provide more languages may also do so.

OCR recognizes concerns raised in the comments regarding the potential cost of translating the Notice of Availability into the required languages. To offset this concern, OCR has provided translations of the model Notice of Availability in the top 15 languages in each State, at www.hhs.gov/​1557. Additionally, § 92.11(c) reduces the number of documents for which provision of the translated notices is required from the 2016 Rule, and § 92.11(d) provides two options for how a covered entity may otherwise meet the requirements of this provision. OCR anticipates that efficiencies created by this formula—complemented by the availability of OCR-translated Notices of Availability—will benefit covered entities and the communities they serve. These benefits will reduce harmful impacts of the failure to take reasonable steps to provide meaningful access—such as unnecessary hospital readmissions, lower rates of outpatient follow up, limited use of preventive services, poor medication adherence, and lack of understanding of discharge Start Printed Page 37569 instructions ^[94] —thereby alleviating burdens on community organizations that have been providing notice of language access as well as providers who have seen negative impacts such as increased costs and sicker patients since the repeal of the 2016 Rule's notice requirements. See87 FR 47853-54. Given these efforts, the requirement of providing notice of language access rights is not overly burdensome when balanced with the need to provide notice of the availability of language assistance services to individuals with LEP.

Comment: A few commenters suggested that a hybrid method should be used to calculate which languages are required for translation under this provision, such as the higher or lower of a percentage or absolute number (for example, a threshold of five percent or 1,000 individuals with LEP, whichever is lower). Some commenters recommended OCR adopt the standard found in Tri-Departmental regulations at 26 CFR 54.9815-2719(e), 29 CFR 2590.715-2719(e), and 45 CFR 147.136(e), which applies a county-level formula and is applicable to the internal claims and appeals and external review processes for group health plans and health insurance issuers in the group and individual health insurance markets, to decrease costs and avoid confusion. Some added that a hybrid method, such as allowing for calculations at the county- instead of State-level, is especially critical for small practices operating at only the county level. They stated these practices may not have resources to translate the Notice of Availability into the top 15 languages spoken in the State and may serve language communities that are different from those represented by the top 15 languages at the State-level.

Response: OCR appreciates these suggestions but, as we discussed in the Proposed Rule, OCR declined to adopt a population threshold due to variances among urban and rural communities. 87 FR 47855. We are concerned about similar results if a percentage threshold is used, and we decline to adopt this approach.

While OCR appreciates that some covered entities will have to comply with both OCR and Tri-Departmental regulations, we decline to adopt the county-level formula found in the referenced Tri-Departmental regulations, 26 CFR 54.9815-2719(e), 29 CFR 2590.715-2719(e), and 45 CFR 147.136(e), which provides that a non-English language is an applicable non-English language if ten percent or more of the population residing in the county is literate only in the same non-English language, as section 1557 applies to a wider range of covered entities, communications, and individuals with LEP. We will continue to monitor issues related to this area and work with CMS as appropriate in the future to ensure compliance.

Comment: Some commenters suggested that OCR work with covered entities and community groups to develop additional effective ways to inform individuals with LEP about their language access rights. A health insurance entity suggested convening a stakeholder process to develop and test a pilot with easy-to-understand, universal language access symbols to connect persons with LEP to language assistance services.

Response: OCR appreciates this recommendation and welcomes the opportunity to collaborate with covered entities and community groups to develop effective means for informing individuals with LEP of their language access rights.

Comment: Many commenters supported the list of documents requiring a Notice of Availability in § 92.11(c), emphasizing the critical importance of clear communications in health care settings. Some commenters noted the provision fills information gaps and that receiving information multiple times is sometimes needed for effective notice, particularly for older adults. Others expressed support for the balanced approach of including opt-out provisions so that covered entities are not overly burdened, but participants and beneficiaries know their rights. Several commenters urged OCR to add medical bills to the list, providing examples of negative impacts of bills being sent without notice of how to access effective communication.

Many other commenters expressed concerns about administrative burdens and costs of notice in relation to the number of communications in which the Notice of Availability would be required under § 92.11(c), while others pointed out that the list is effectively shorter than in the past.

Several commenters wrote generally about language assistance services and auxiliary aids and services, with some asking for flexibility in the language access rules to allow for translation of the most important documents with the provision of oral interpretation for other information. Another argued that translation and interpretation as well as auxiliary aids and services rules should not apply to physician practices or health centers. Others requested that health insurance issuers or the Federal Government reimburse providers for disseminating these items.

Response: We appreciate the comments and believe that the list of documents identified in § 92.11(c), which provides clarity and prioritizes inclusion of the Notice of Availability in critical health care documents, strikes the appropriate balance between potential burdens to covered entities and the benefits to individuals with LEP and individuals with disabilities. OCR appreciates commenters raising concerns regarding the accessibility of medical billing, which can have long-term negative financial impacts on patients.^[95] Similarly, accessible notices of expected costs and benefits, such as the good faith estimate, can help patients make informed, cost-conscious decisions about their care and reduce the risk of unexpected medical bills.^[96] The potential financial impact of making these estimates accessible is particularly significant for individuals with LEP and individuals with disabilities who are uninsured (or self-pay), because these individuals have the right to dispute medical bills that are substantially in excess of the expected charges on their good faith estimate ^[97] and exercise of this right depends on the ability of such individuals to understand both their good faith estimates and their medical bills. For these reasons, we are adding § 92.11(c)(5)(ix), which requires a covered entity to provide its Notice of Availability along with billing-related documents and reads: “Communications related to the cost and payment of care with respect to an individual, including medical billing and collections materials, and good faith estimates required by section 2799B-6 of the Public Health Service Act.”

Comment: Regarding an alternative, optional means of compliance at § 92.11(d), one covered entity commenter requested that OCR specify that entities in compliance with other Start Printed Page 37570 Department requirements related to language access and auxiliary aids are deemed to have complied with section 1557. One commenter stated that the Notice of Availability should be combined with the Notice of Nondiscrimination, as well as HIPAA notices; another suggested OCR work with CMS and other HHS agencies to leverage existing practices and make these requirements technically operational.

Response: As discussed elsewhere, OCR appreciates that covered entities may have compliance requirements under other Department regulations similar to those found in this provision. However, given the range of health programs and activities to which section 1557 and the part apply—including those where inaccessible communication can have life-or-death consequences—it is imperative to have an independent requirement. Covered entities' compliance with § 92.11(b) will increase the likelihood of compliance with similar Department translation requirements. While we appreciate commenters' suggestion to combine the Notice of Availability with the Notice of Nondiscrimination and the HIPAA notices, § 92.11(c)(5) requires the Notice of Availability to additionally be included with a list of important health care documents because the ability of patients to avail themselves of language access services is foundational to improving health outcomes for individuals with LEP. OCR will therefore maintain this requirement under § 92.11(c)(5) for covered entities.

Comment: Various commenters expressed support for the alternate compliance provisions found in § 92.11(d). One group raised the idea of an “opt-in” provision, in which individuals with LEP would have to state that they want Notice of Availability, in lieu of the proposed opt-out provision, and sought clarification about whether the opt-out provision can be combined with Notice of Availability.

Some commenters argued that the alternate compliance options could be difficult to implement and lead to additional costs, cause confusion, or be generally burdensome, with one commenter stating they would be more burdensome than the 2016 Rule requirements because they require customizing documents. One commenter requested OCR delay implementation of the opt-out provision until 2024; other commenters suggested replacing the option with a less burdensome approach, asking that it be only electronic.

On the other hand, commenters stated that the opt-out provision strikes a reasonable balance that is effectively narrower than the 2016 Rule's “significant communications” requirement. Another commenter agreed, commenting that the proposal could be both more consumer friendly and helpful, as well as less duplicative and costly than the 2016 Rule. One commenter encouraged OCR to provide robust oversight of opt-out processes in order to protect civil rights.

Response: OCR appreciates the range of comments received on this new provision. We emphasize that the options included in § 92.11(d) are options, and not requirements. Thus, we appreciate that covered entities may wish to have a delayed applicability date, to pursue these options only through electronic means, or not pursue them at all. OCR is not requiring any actions under § 92.11(d) be taken; rather, OCR is providing alternate means to satisfy the requirements of § 92.11 without including the full Notice of Availability with all communications listed at § 92.11(c).

OCR declines to make further changes clarifying that a person should only be asked about their language needs once, because § 92.11(d)(1) permits this if the individual exercises the option to opt-out. Moreover, § 92.11(d)(2) allows a covered entity to document an individual's primary language, any appropriate auxiliary aids and services, and to communicate with them in that manner.

OCR intends to provide robust review of opt-outs, as well as technical assistance, to ensure that covered entities that choose to exercise this option do so in a manner consistent with the requirements at § 92.11(d).

Comment: Many commenters submitted recommendations to increase guarantees of accessibility of the Notice of Availability for individuals with disabilities, such as requiring that: (1) notices be provided in large sans serif print, at a minimum of 18-point font; (2) notices be on the first page or otherwise at the beginning of documents or publications; (3) the needs of persons who are illiterate be taken into account through provision of audio or video notices; (4) all written notices be in plain language (fourth grade reading level), accompanied by visual aids when practicable; and (5) notice should be provided via audio, video, and American Sign Language. A coalition also discussed recommendations to ensure effective communication. Other accommodations recommended included: (1) screen readers and audio/video accessibility; (2) alternatives to braille ( e.g., large print, qualified reader) because braille may not be economically feasible for all entities; (3) accessible tagline requirements or cross-references to language access rights; and (4) “Easy Read” text, images, brief sentences, large and simple fonts, and location on the first page.

Many also commented that the Notice of Availability should be posted where frontline employees can readily see it, that employees should be trained to provide it, and that it be available upon request. Various commenters urged that covered entities must proactively ask people if they have communications barriers. Further, commenters stated that primary consideration should be given to what a person with a disability asks for in terms of auxiliary aids or services. Another commenter added that provision of the notice should be clarified so it applies to listening devices and the other range of auxiliary aids.

Response: OCR appreciates all the suggestions and reminds commenters and others that the meaningful access and effective communication requirements (§§ 92.201 and 92.202, respectively) regarding the provision of language access and auxiliary aids apply to the Notice of Availability. Covered entities have existing effective communication obligations under section 504 and section 1557, which may include providing the notice in an alternate format or providing another auxiliary aid or service. Thus, if an individual is in need of the notice in an alternate format or through another auxiliary aid or service, that would likely already be required when it is necessary to ensure effective communication. We decline to affirmatively require the notice be provided in any additional formats at this time. However, OCR agrees that larger print should be required to ensure the accessibility of the Notice of Availability when posted in physical locations, and that this requirement is relatively straightforward to implement; accordingly, § 92.11(c)(4) has been amended to require print no smaller than 20-point in a sans serif font.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.11, with modifications. We are revising § 92.11(b) to clarify the relevant State or States are those “in which a covered entity operates.” We are modifying § 92.11(c)(4) to clarify that posted notices be provided “in no smaller than 20-point sans serif font.” We are adding Start Printed Page 37571 § 92.11(c)(5)(ix) to read: “Communications related to the cost and payment of care with respect to an individual, including medical billing and collections materials, and good faith estimates required by section 2799B-6 of the Public Health Service Act.” We are also making technical revisions, including replacing “limited English proficient individual” with “individual with limited English proficiency,” consistent with modifications elsewhere.

Data Collection

We solicited comments on requiring covered entities to collect additional data, beyond those required by the referenced statutes and their regulations, on race, ethnicity, language, sex, gender, gender identity, sexual orientation, disability, and age, to inform a final rule and OCR's overall civil rights work.

We also sought comment on whether covered entities are already collecting disaggregated demographic data in their health programs and activities and, if so, for which categories of data, through what systems, and at what cost. We also invited comment on how a section 1557 civil rights data collection requirement could impact current data collection efforts, either positively or negatively. We also requested comment on whether the adoption of a regulatory standard for a recurring civil rights data collection would benefit civil rights enforcement, as well as how frequently the data should be submitted to OCR. We also sought comment on whether the data collection requirements should vary by type of entity, as recipients of Federal financial assistance include a variety of entities, including State and local agencies, health insurance issuers, providers, health care facilities and clinics, hospitals, Federally Qualified Health Centers, and health-related educational and training programs. Accordingly, we invited comment on which types of recipients (if any) should be covered; if recipients under a certain size should be exempt from the data collection requirement, and if so, whether that exemption should be based on employee number, the number of beds (if relevant), or some other metric; what types of data should be collected; what definitions should be used; the potential costs associated with such a requirement; and the potential benefits of such a requirement.

The comments and our responses regarding data collection are set forth below.

Comment: Some commenters recommended that OCR not mandate the collection of data, with some strongly suggesting that we minimize provider burden and utilize existing data collection systems.

Response: OCR is not including a data collection requirement in the final rule. OCR has the authority independent of this rulemaking to conduct data calls to ensure recipient compliance with Federal civil rights laws.^[98] OCR is actively engaged with other agencies within the Department and throughout the Federal Government related to responsible data collection and recognizes the importance of data collection to meet its mission. We will continue to work with covered entities and beneficiaries to determine whether an additional data collection requirement is needed in a future rulemaking.

Comment: Some commenters recommended that OCR adopt data collection standards. They noted that with any demographic data collection requirement, OCR must provide appropriate training and technical assistance resources to programs and grantees and make clear that data cannot be used for negative actions such as immigration or law enforcement, redlining, or targeting of specific groups.

Response: OCR appreciates the comments regarding standards and safeguards to ensure that programs and grantees have the appropriate training. OCR also understands the concerns that some commenters have regarding data being used for adverse actions. While OCR is not including a data collection requirement in the final rule, OCR will continue to research the benefits of civil rights data collection and how to mitigate potential negative impacts.

Comment: Some commenters urged OCR to require covered entities to collect data regarding a core set of disaggregated categories to include race, ethnicity, language, sex, gender, gender identity, sexual orientation, pregnancy status, sex characteristics, disability, and age from patients and providers. Commenters stated that data are essential to identify and address unmet needs, and for many populations data remain largely uncollected. Some commenters also noted that collecting disaggregated data could allow OCR to distinguish the impact of intersectional discrimination on those seeking access to health care. Some commenters also urged that if individuals volunteer such information, it should be self-reported to ensure accuracy and privacy.

Response: OCR agrees that better standards and practices for collecting data can have a positive impact on reducing disparities. OCR will continue to work to ensure that any civil rights data collection yields accurate data that adequately protects the privacy of individuals.

Summary of Regulatory Changes

For the reasons set forth above and considering the comments received, we are finalizing the rule without a data collection provision.

Subpart B—Nondiscrimination Provisions

In subpart B, OCR proposed provisions related to the prohibition of discrimination on the basis of race, color, national origin, sex, age, and disability in covered health programs and activities.

Discrimination Prohibited (§ 92.101)

In § 92.101(a), we proposed a general prohibition of discrimination on the basis of race, color, national origin, sex, age, or disability under any health program or activity to which section 1557 or the part applies and provided additional detail regarding what constitutes discrimination on the basis of sex.

In § 92.101(a)(1), we proposed general prohibitions on discrimination under section 1557 by restating the core objective of section 1557. In § 92.101(a)(2), we clarified that discrimination on the basis of sex includes discrimination on the basis of sex stereotypes; sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; and gender identity.

In § 92.101(b), we identified several specific forms of prohibited discrimination under section 1557. Proposed § 92.101(b)(1)(i) specifically referred to recipients of Federal financial assistance and State Exchanges; proposed § 92.101(b)(1)(ii) referred to the Department's health programs and activities, including Federally-facilitated Exchanges.

In § 92.101(b)(2), we proposed that the enumeration of specific forms of discrimination in 92.101(b) does not limit the general application of the prohibition in proposed § 92.101(a).

The comments and our responses regarding § 92.101 are set forth below.

Comment: Numerous commenters supported the Proposed Rule's nondiscrimination provisions, stating that these provisions would promote the health equity for communities of color and increase access to coverage and care for those who have been historically underserved because of race, ethnicity, language, age, disability, and sex. Many commenters stated that OCR should finalize the provisions without delay. Start Printed Page 37572 Another commenter supported the proposed discrimination prohibitions as consistent with the ACA, and another requested that more support be provided for educating the public about the nondiscrimination obligations of health programs and activities.

Response: OCR agrees that the nondiscrimination provisions are one important tool to address health disparities and advance health equity. OCR will continue to provide technical assistance and public education related to compliance with section 1557 and encourages covered entities to continue to visit our website for technical assistance materials.

Comment: Numerous commenters stated that section 1557's explicit prohibition on discrimination based on multiple grounds fills a critical gap by protecting patients who may experience multiple forms of discrimination. Commenters provided numerous examples of simultaneous discrimination on more than one protected basis, including, but not limited to, discrimination against LGBTQI+ individuals of color, with disabilities, with LEP, or who are immigrants; and Black and Hispanic/Latino older adults. Numerous commenters recommended that OCR revise § 92.101(a)(1) to include “or any combination thereof” to explicitly account for intersectional discrimination within the regulatory text.

Response: OCR agrees that simultaneous discrimination on multiple prohibited bases, is important to account for and is prohibited by section 1557. As we noted in the Proposed Rule, a recent study examined disability and pregnancy as intersecting traits and how this may impact risk for maternal morbidity and mortality, underscoring the importance of ensuring nondiscrimination against women with disabilities. 87 FR 47837. The Proposed Rule also provided information regarding Black maternal health and the alarming disparities in maternal mortality rates for Black women and American Indian/Alaska Native women. 87 FR 47832.

Therefore, to account for the fact that individuals can experience discrimination based on two or more protected bases (race, color, national origin, sex, age, and disability), we have amended the language of § 92.101(a)(1) to include “or any combination thereof.” This language has also been amended throughout the final rule for consistency. The addition intends to clarify that an individual is protected from discrimination on more than one protected basis that occurs at the same time.

Comment: A commenter provided a discussion of the harms and unaddressed discrimination faced by patients with rare diseases and requested that OCR explicitly prohibit discrimination against patients with rare diseases. Some commenters requested that specific recognition also be made for patients with liver diseases. A commenter requested that the proposed regulatory text or accompanying guidance provide examples of discrimination on the basis of disability.

Response: Discrimination against an individual with a rare or specific disease that meets the definition of “disability” will be addressed under section 1557's prohibition on discrimination on the basis of disability, which already appears in the rule. The commenter's request for further guidance will be taken into consideration. For additional information related to disability discrimination, please see the discussions under subpart C. OCR also provides guidance and examples, as well as answers to frequently asked questions related to disability discrimination on our website.

Comment: A number of commenters asked that vaccination status be added as a ground of prohibited discrimination, stating that their right to make their own health care decisions should be protected.

Response: Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, and disability. To the extent vaccination status is not related to these prohibited bases of discrimination specified by Congress in section 1557, we decline to include it as a ground of prohibited discrimination under this rule.

Comment: Some tribal organizations recommended that OCR acknowledge American Indian/Alaska Native (AI/AN) people as holding a political classification as compared to a race-based classification and to exempt Tribal health programs from the final rule. These commenters stated that recognizing the political classification of AI/AN people allows AI/AN providers to only serve AI/AN patients, which commenters said is necessary because of logistical capacity constraints.

Response: As discussed at § 92.2, OCR recognizes the unique relationship between the United States and federally recognized tribal entities. Federal Government preferences based on an individual's membership or eligibility in a federally recognized tribal entity are based on political classifications. Such classifications are not race-based. As such, preferences on this basis do not violate the Equal Protection Clause,^[99] title VI,^[100] or section 1557. As discussed at § 92.2, preferences based on the unique relationship between the United States and federally recognized Tribes are distinct from the protections afforded under Federal civil rights laws, which protect all individuals from discrimination on the basis of race, color, or national origin (including AI/AN individuals, regardless of tribal enrollment or affiliation). This final rule adopts by reference the Department's title VI regulatory provision at 45 CFR 80.3(d), which provides that an individual shall not be deemed subjected to discrimination by reason of their exclusion from benefits limited by Federal law—such as the Indian Health Service—to individuals of a different race, color, or national origin. OCR will fully apply this provision as well as other applicable exemptions or defenses that may exist under Federal law. OCR intends to address any restrictions on application of section 1557 to Tribal entities in the context of individual complaints or compliance reviews.

Comment: A commenter suggested that nondiscrimination protections should be extended to health care workers, indicating that health care workers often experience discrimination, especially on the basis of race and that additional protections are needed.

Response: While OCR acknowledges that health care workers can face discrimination as they provide health care, OCR does not have jurisdiction over patients who may discriminate against health care workers, as patients are not covered entities under section 1557. Separately, and as previously noted, OCR does not intend for this rule to apply to employment discrimination. If OCR receives a complaint from a health care worker, we will determine if we have jurisdiction to investigate. Complaints received by OCR from health care workers alleging discrimination experienced in the context of employment will be referred to an appropriate agency, per §§ 92.303(b) and 92.304(a) (incorporating 45 CFR 85.61(e)), as this regulation does not apply to employment practices.

Comment: Many commenters expressed support for the explicit references to discrimination on the basis of sex stereotypes; sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; and gender identity as forms of Start Printed Page 37573 discrimination on the basis of sex in § 92.101(a)(2). Commenters pointed to evidence of health disparities and barriers to accessing health care faced by LGBTQI+ people, and how ongoing health care discrimination contributes to higher rates of substance use, mental health conditions, HIV, cancer, and cardiovascular disease for LGBTQI+ people relative to non-LGBTQI+ people.^[101] Several commenters stated that § 92.101(a)(2)'s prohibitions should be mirrored in the CMS regulations addressed in section IV.

Response: It is well documented that LGBTQI+ people face significant health disparities and barriers to health care and insurance coverage,^[102] and section 1557's protections are critical tools to combat those disparities. We appreciate commenters' view that CMS regulations within this rulemaking should mirror the language provided in § 92.101(a)(2), and we refer readers to section IV (CMS Amendments).

Comment: A number of comments addressed discrimination in the context of organ transplantation. Several commenters noted that people with disabilities are routinely denied access to organ transplants due to stereotypical assumptions about compliance with post-operative care and policies that deny transplants to otherwise eligible individuals with disabilities.^[103]

Several commenters noted that existing practices in organ transplants appear to discriminate against Black, Hispanic/Latino, and Native American/Alaska Native individuals, as those individuals are more likely to develop end stage renal disease but are less likely to receive a kidney transplant than white individuals.^[104] Another commenter stated that providers may discriminate against immigrant patients during the assessment process by assuming they lack social support or the ability to care for themselves after organ transplantation, resulting in a denial of care.^[105]

Response: Discrimination on the basis of disability and race in the provision of health care, including organ transplantation, is a continuing issue that limits opportunities for life-saving treatment. This final rule provides OCR with a powerful tool to help address this ongoing issue. While section 1557 does not prohibit discrimination on the basis of immigration status, section 1557's protections apply regardless of someone's citizenship or immigration status, and individuals who believe they have been discriminated against based on certain characteristics such as race, color, and national origin can file a complaint. We will continue to address discrimination in organ transplantation through robust enforcement of not only section 1557, but all Federal civil rights laws.^[106]

Comment: Numerous commenters generally supported the inclusion of the prohibition of discrimination on the basis of gender identity and sexual orientation as prohibited types of sex discrimination in proposed § 92.101(a)(2). They maintained that inclusion was consistent with Bostock v. Clayton County, 590 U.S. 644 (2020), in which the Supreme Court held that title VII's prohibition of discrimination because of sex includes discrimination on the basis of sexual orientation and gender identity. Commenters supported the application of the reasoning in Bostock to title IX by citing several cases, DOJ resource materials, and Executive Order (E.O.) 13988.^[107] Another commenter cited several cases stating that courts have treated title VII and title IX protections as consistent with one another in support of the application of Bostock to title IX.^[108] A few commenters cited City of Los Angeles Department of Water and Power v. Manhart, 435 U.S. 702 (1978), as indicating that, for decades, sex discrimination prohibitions have covered sex stereotypes. The commenters also cited several opinions from district courts and one appellate court as indicating that discrimination on the basis of gender identity, gender transition, sex stereotypes, or transgender status are, similarly, unlawful types of sex discrimination.^[109] Other commenters provided cites to numerous other cases as including gender identity and sexual orientation as characteristics protected by sex discrimination law.^[110]

Conversely, several commenters stated that Bostock does not support § 92.101(a)(2) as written. Some commenters stated that Bostock defined sex to include only “biological distinctions between male and female” and used the term “transgender status” Start Printed Page 37574 rather than “gender identity.” A commenter argued that title VII should be treated as distinct from title IX because title IX uses the term “on the basis of sex”—language the commenter described as requiring more than “but for causation”—while title VII uses “because of . . . sex.” Other commenters discussed title IX to support arguments that discrimination on the basis of sex does not include discrimination on the basis of sexual orientation or gender identity, and that title IX only protects people on the basis of “biological sex.”

Some commenters cited to various cases in opposition to the inclusion of gender identity and sexual orientation in proposed § 92.101(a)(2), including State of Tennessee v. Department of Education, 615 F. Supp. 3d 807 (E.D. Tenn. 2022), to support the belief that agencies cannot rely on the reasoning in Bostock to interpret what constitutes sex discrimination under title IX. Another commenter stated that E.O. 13988 improperly expands the application of Bostock and cited Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016) in support. Some commenters stated that RFRA's religious protections may supersede the sex discrimination protections described in Bostock, and one commenter cited Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, 565 U.S. 171 (2012), for the proposition that that First Amendment protections may supersede employment discrimination laws. Another commenter stated that OCR's interpretation of what is prohibited sex discrimination is contrary to law, citing to Franciscan Alliance, Inc. v. Becerra  ^[111] and Christian Employers Alliance v. EEOC.^[112]

Response: Case law offers strong support for the position that sex discrimination under section 1557 includes discrimination on the basis of gender identity and sexual orientation. As previously noted, a body of developing case law explains how to identify unlawful sex discrimination. As part of its prohibition on sex discrimination, this rule prohibits discrimination against individuals who do not conform with stereotypical notions of how an individual is expected to present as male or female, regardless of gender identity. This is consistent with longstanding case law; more than 30 years ago, a plurality of the Supreme Court held in Price Waterhouse that discrimination based on sex stereotypes was a prohibited form of sex discrimination. We have included a number of examples throughout the preamble discussion to help covered entities better understand their obligations. OCR is also committed to providing technical assistance to support compliance with this final rule and may consider additional guidance that may assist covered entities with their obligations.

As noted in the Proposed Rule, the inclusion of “sexual orientation” and “gender identity” in § 92.101(a)(2) is consistent with the Supreme Court's reasoning in Bostock.87 FR 47858. Title IX and section 1557 prohibit discrimination “on the basis of sex.” ^[113] And the Bostock Court used the phrase “because of sex” and “on the basis of sex” interchangeably.^[114] Because the statutory prohibitions against sex discrimination in title VII and title IX are similar, the Supreme Court and other Federal courts look to interpretations of title VII to inform title IX.^[115] Thus, Bostock' s discussion of the text of title VII informs the OCR's analysis of title IX and section 1557. Given the similarity in nondiscrimination language between title VII and title IX, many Federal courts that have addressed the issue have interpreted section 1557 and title IX consistent with Bostock' s reasoning.^[116] Since Bostock, three Federal courts of appeals have held that the plain language of title IX's prohibition on sex discrimination must be read similarly to title VII's prohibition.^[117] OCR agrees with the reasoning in these cases.^[118] Additionally, there is a significant amount of case law, pre-and post- Bostock that affirms that sex discrimination includes discrimination based on gender identity.^[119]

We disagree with commenters' assertion that the Court's use of the term “transgender status” in Bostock, rather than “gender identity,” results in any meaningful distinction regarding protections afforded to transgender individuals or other individuals experiencing discrimination on the basis of their gender identity. The Court's choice of language reflects that it was addressing the gender identity of the plaintiff before it, who was transgender, and does not preclude the case's application to other gender identities. Indeed, even the dissent stated that “there is no apparent difference between discrimination because of transgender status and discrimination because of gender identity.” 590 U.S. at 686, n.6 (Alito, J. joined by Thomas, J., dissenting).

Additional citations by those opposing the language in § 92.101(a)(2) are either not applicable, already discussed in the Proposed Rule, or outdated. To begin, this rule does not Start Printed Page 37575 rely on E.O. 13988 for its authority, so criticisms of that order do not undermine the final rule. State of Tennessee is inapposite. There, the court held that the plaintiffs had demonstrated a reasonable likelihood of success on the claim that two other Federal agencies violated the Administrative Procedure Act by foregoing notice-and-comment procedures.^[120] That is not at issue here, as this is notice-and-comment rulemaking and not the issuance of informational documents. Hosanna-Tabor involved First Amendment limitations on the application of employment discrimination laws—specifically the “ministerial exception” that precludes application of employment discrimination laws to “claims concerning the employment relationship between a religious institution and its ministers.” 565 U.S. at 188. As discussed throughout the Proposed Rule, beginning at 87 FR 47826, OCR is aware of and discusses both Franciscan Alliance v. Becerra and Christian Employers Alliance v. EEOC, and the Department is not prohibited from finalizing this rule by either decision. 87 FR 47826. Additionally, the final rule adopts new procedures for recipients wishing to invoke Federal religious freedom and conscience protections. For more on those procedures, see § 92.302.

Finally, OCR disagrees with the commenters who cited Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016), in support of the view that section 1557 and title IX's prohibition on sex discrimination does not include discrimination on the basis of sexual orientation and gender identity. The legal landscape in this area has changed since that decision issued and the publication of the Proposed Rule. The Franciscan Alliance v. Burwell court concluded that the 2016 Rule's definition of “sex” as including “gender identity” was contrary to section 1557 because “Title IX and Congress' incorporation of it in [section 1557 of] the ACA unambiguously adopted the binary definition of sex.” Id. at 689. Four years later, the Supreme Court held that the prohibition on discrimination “because of . . . sex” under title VII covers discrimination on the basis of gender identity and sexual orientation, even assuming that “sex” refers “only to biological distinctions between male and female.” Bostock, 590 U.S. at 655. The Bostock Court held that the statute's prohibition on employment discrimination “because of sex” encompasses discrimination on the basis of sexual orientation and gender identity. Id. at 670-71.

Comment: Several commenters generally asserted that sex is an immutable, biological binary. Some commenters relayed that their religious beliefs include that sex is an immutable binary. A commenter stated that sex has a biological component that impacts medical care.

A commenter argued that if the rule does not recognize that sex is a biological binary, there will be increased confusion in the provision of medical services. Another commenter expressed concern that the rule would diminish the quality of health care received by some patients because some health conditions, such as symptoms of heart attacks, are based on “biological sex characteristics.” A commenter said that a prohibition of discrimination on the basis of gender identity would validate the recognition of gender identity and increase gender dysphoria.

Response: OCR recognizes that sex has biological components and knowledge of an individual's biological attributes is an essential component of providing high quality health care for all patients. For example, in the Proposed Rule, we discussed the various health disparities experienced by women, which require that providers have adequate knowledge of biology and anatomy to effectively address. 87 FR 47833-34.

OCR disagrees with commenters suggesting that nondiscrimination protections on the basis of gender identity will either cause confusion in the medical profession or lead to diminished quality of care. Health care providers are highly trained in issues of biology, anatomy, and physiology. This rule requires that individuals be treated without discrimination on the basis of sex. There is no evidence that demonstrates that compliance with civil rights protections, including on the basis of sex, has caused any confusion in the medical field. On the contrary, evidence suggests that when patients are protected on the basis of sex in health care programs, quality of care improves because patients at risk of discrimination are more likely to seek and receive high quality care. For example, research shows that individuals who are experiencing gender dysphoria—defined by the American Psychiatric Association to include “clinically significant distress or impairment related to gender incongruence”—have a clinically significant decrease in distress if they have access to medically necessary care.^[121]

Moreover, section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician's judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. There is no part of section 1557 that compels clinicians to provide a service that they do not believe is medically appropriate for a patient or that they are not qualified to provide.

With respect to commenters' concerns about potential conflicts between the final rule and individuals' or organizations' sincerely held religious beliefs, we refer commenters to the discussion of this topic at § 92.302.

Comment: Some commenters stated that because OCR relied on Bostock, it is bound by the definition of “sex” in Bostock and that definition should be included in the final rule. These commenters opined that the term “sex characteristics” as used by OCR is sometimes contrary to a binary understanding of the term “sex,” and accordingly “sex characteristics” either must be avoided in the regulations or used in a manner not to contradict the term “sex” being binary.

Response: OCR has determined it is not necessary to define “sex” in this rule, as we have addressed a non-exhaustive list of what constitutes discrimination on the basis of sex at § 92.101(a)(2). The Supreme Court did not define the term “sex” in Bostock, but rather noted that nothing in their approach to the cases considered turned on the debate over whether “sex” was limited to “biological distinctions between male and female,” and the Court therefore proceeded on the assumption that “sex” carried that meaning. 590 U.S. at. 655.

OCR declines to remove reference to “sex characteristics” (including intersex traits) from § 92.101(a)(2). Discrimination on the basis of sex characteristics, including intersex variations, is a prohibited form of sex discrimination because discrimination based on anatomical or physiological sex characteristics is inherently sex-based. See87 FR 47858.

Comment: Numerous commenters supported the explicit inclusion of Start Printed Page 37576 discrimination based on sex characteristics, including intersex traits, stating that discrimination based on intersex traits is inherently sex-based. Several commenters supported this proposal, citing barriers to appropriate care and coverage resulting from discrimination suffered by intersex patients.^[122] These commenters cited a report in which more than half of intersex respondents reported that a provider refused to see them because of their sex characteristics or intersex variation and that almost two-thirds reported having concerns that if they disclosed their intersex status to a provider, they could be denied quality medical care.^[123] A few commenters recommended that § 92.101(a)(2) include concrete examples of sex discrimination, specifically on the basis of intersex traits.

Response: Discrimination based on sex characteristics is a prohibited form of sex discrimination because discrimination based on anatomical or physiological sex characteristics is inherently sex-based. 87 FR 47858. It follows that discrimination on the basis of intersex traits is prohibited sex discrimination because the individual is being discriminated against based on their sex characteristics.

Comment: Numerous commenters generally supported the inclusion of pregnancy or related conditions as protected bases of sex discrimination at § 92.101(a)(2) and recommended that OCR include examples of pregnancy-related discrimination. Commenters recommended including protection for pregnancy-related conditions as a standalone provision to emphasize the importance of these protections. Commenters stated that protection against discrimination on the basis of pregnancy or related conditions would protect many patients. Commenters also pointed out that as drafted, the Proposed Rule does not consistently define sex discrimination to include pregnancy-related conditions because other sections just state “pregnancy” as opposed to “pregnancy or related conditions.” The commenters urged OCR to be consistent throughout the rule.

Response: The inclusion of “pregnancy or related conditions” is consistent with the longstanding interpretation of the “ground” of discrimination prohibited under title IX because pregnancy-based discrimination has long been understood as a form of sex-based discrimination under title IX. For many years preceding the enactment of the ACA, the Department (along with other agencies) determined that discrimination based on pregnancy or related conditions is discrimination based on sex.^[124] Discrimination on the basis of pregnancy or related conditions may include, but is not limited to, instances of individuals who experience discrimination throughout pregnancy, labor and delivery, or the postpartum period. OCR agrees that the explicit inclusion of pregnancy or related conditions in the rule text is important for protecting many patients from discrimination.

As discussed in the Proposed Rule, OCR considered inclusion of a provision to specifically address discrimination on the basis of “pregnancy or related conditions.” 87 FR 47878. We received comments stating that a separate section was not appropriate. Those comments recommended that this issue be addressed under either § 92.101 (Discrimination prohibited) or § 92.206 (Equal program access on the basis of sex). Accordingly, we maintain the inclusion of “pregnancy or related conditions” here under § 92.101(a)(2). For a further discussion of “pregnancy or related conditions,” please refer to the preamble discussion at § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status).

Comment: A commenter stated that protections from pregnancy-based discrimination should include an informed consent requirement for abortion and childbirth, because the commenter asserted that consent for a Cesarean delivery is often obtained through coercion.

Response: As noted in the Proposed Rule, 87 FR 47868, informed consent to any medical treatment is both a legal and ethical standard, regardless of the type of care, and serves as a basis for shared decision making.^[125] OCR declines to make any changes in response to this comment.

Comment: Numerous commenters recommended that, in light of the Supreme Court's decision in Dobbs v. Jackson Women's Health Organization, 142 S. Ct. 2228 (2022), and increased restrictions on reproductive health, OCR should provide that “pregnancy or related conditions” includes termination of pregnancy in the final rule. A group of commenters opined that the definition of “pregnancy or related conditions” should expressly exclude an abortion.

Several commenters stated that OCR should clarify that this provision protects patients from discrimination on the basis of actual or perceived prior abortions. Several commenters stated that, as a result of abortion bans that have gone into effect post- Dobbs, women have been denied critical care, such as cancer treatment, because of abortion-related concerns. A commenter wrote that abortion is often necessary to save patients' lives, especially from complications like ectopic pregnancy or premature rupture of membrane.

Response: OCR appreciates commenters' concerns and recognizes that the Supreme Court decision in Dobbs changed the legal landscape as to abortion access. While we agree that protections afforded for pregnancy or related conditions include termination of pregnancy, OCR declines to revise the language at § 92.101(a)(2) to include or exclude specific examples and will interpret section 1557's protections on the basis of sex consistent with applicable case law addressing discrimination on the basis of sex, including pregnancy or related conditions.

OCR has concluded as a matter of statutory interpretation that section 1557 does not require the Department to incorporate the language of title IX's abortion neutrality provision, see preamble discussion at § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status). At the same time, OCR emphasizes that a covered provider's decision not to provide abortions does not itself constitute discrimination in violation of section 1557. Also, a covered provider's willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion also is not discrimination under section 1557. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. A covered provider that generally offered abortion care could violate that prohibition if, for example, it refused to provide an abortion to a particular patient because of that patient's race or disability. But a covered provider does not engage in Start Printed Page 37577 discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason.

It bears emphasis that nothing in the ACA, including section 1557, has “any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.” 42 U.S.C. 18023(c)(2)(A). In addition, nothing in the ACA, including section 1557, preempts or has any effect on State laws regarding “the prohibition of (or requirement of) coverage, funding, or procedural requirements on abortions” as provided in section 1303 of the ACA, 42 U.S.C. 18023(c)(1).

Against this legal landscape, OCR will evaluate specific claims of discrimination on prohibited bases on a case-by-case basis, and we decline to revise the language at § 92.101(a)(2). We note also that, as commenters suggested, this provision protects patients from discrimination on the basis of actual or perceived prior abortions. For example, a recipient's denial of unrelated medical care that the provider generally provides to other patients to an individual based solely on the fact they had a prior abortion would constitute prohibited discrimination within the meaning of section 1557. Moreover, both the 2016 and 2020 Rules recognized that discrimination on the basis of pregnancy termination can be a form of sex discrimination.

Comment: Conversely, a commenter argued that OCR should not interpret “pregnancy or related conditions” to include “termination of pregnancy” because of a concern that it will force health care providers to participate in abortions and requested that OCR provide further clarification as to what types of conduct would be prohibited discrimination under the rule. Another commenter stated the Proposed Rule wrongly treats abortion as a right protected from sex discrimination and that title IX contains an abortion neutrality provision that the rule would contravene.

Response: As discussed above, a covered provider's decision not to provide abortions does not itself constitute discrimination in violation of section 1557. A covered provider does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason. A covered entity that chooses to provide abortion care but refuses to provide an abortion for a particular individual on the basis of a protected ground—such as race—would violate section 1557. For discussion regarding the title IX abortion neutrality provision, please see § 92.208.

Comment: Several commenters requested that OCR clarify that § 92.101(a)(2) prohibits discrimination against individuals when they are seeking or accessing fertility care, maternity care, and other reproductive health care specifically. A commenter recommended that OCR clarify that pregnancy-related care applies throughout pregnancy, childbirth, and the postpartum period.

Response: Section 1557 protects individuals against prohibited discrimination in all covered health programs and activities regardless of the type of care they are seeking or accessing, including fertility care, maternity care, and other reproductive health care. Similarly, section 1557 protects individuals seeking or accessing health programs and activities provided for or during preconception, pregnancy, childbirth, and postpartum recovery. Ensuring that section 1557's protections apply throughout the continuum of care is especially critical for Black women and other people of color, who face worse health outcomes and experience higher rates of discrimination throughout pregnancy and the postpartum period.^[126]

Comment: Many commenters raised concerns about barriers to reproductive health care faced by LGBTQI+ patients. A commenter strongly urged more explicit inclusion of “fertility” as a form of impermissible sex-based discrimination—so that § 92.101(a)(2)(ii) prohibits discrimination on the basis of “pregnancy, fertility, or related conditions”—as infertility is a serious issue that impacts many LGBTQI+ populations. Commenters stated that LGBTQI+ people continue to face barriers to fertility treatment, such as in vitro fertilization (IVF), and that coverage of fertility treatments often limit or exclude LGBTQI+ patients.

Response: OCR acknowledges the unique challenges faced by LGBTQI+ individuals seeking fertility treatment. Individuals are protected from discrimination regardless of the type of health care they seek, and we have concluded it is unnecessary to provide provisions for each specific form of health care available. Whether discrimination on the basis of sexual orientation or gender identity occurred in the provision or coverage of assistive reproductive technology—such as IVF—is necessarily fact specific. However, if a covered entity elects to provide or cover fertility services but categorically denies them to same-sex couples, it may violate section 1557's prohibition on sex discrimination.

Comment: Numerous commenters generally supported inclusion of sexual orientation as a protected basis for sex discrimination, and said that its inclusion would improve health care for LGBTQI+ individuals. Many commenters stated that LGBTQI+ individuals face discriminatory challenges to accessing health care and that the rule would alleviate these issues. Many commenters wrote that LGBTQI+ individuals often anticipate that they will experience discrimination in health care and thus often may not seek out care.

Response: It is well documented that LGBTQI+ individuals face discrimination when accessing or attempting to access health care and health insurance. Section 1557 is a critical tool in combating such discrimination and addressing the resulting health disparities and other negative impacts.

Comment: Numerous commenters generally supported the inclusion of discrimination on the basis of gender identity as a prohibited form of sex discrimination. Other commenters recommended including “transgender or nonbinary status,” “nonbinary and gender-nonconforming,” and “including status as transgender, nonbinary, gender nonconforming, two-spirit, or other gender.”

Response: OCR recognizes that individuals use various terminology to describe their gender identity. For this reason, we decline to provide a definition of “gender identity” or “transgender status” in the regulation. We reiterate here that OCR will investigate discrimination against an individual based on having a gender identity that is different from their sex assigned at birth as discrimination on the basis of gender identity, regardless of whether the individual identifies with or uses the term “transgender” or another identity.

OCR is aware that the Bostock majority uses the term “transgender Start Printed Page 37578 status” exclusively. But Bostock reasoned that when a person discriminates “against transgender persons, the employer unavoidably discriminates against persons with one sex identified at birth and another today” such that “[a]ny way you slice it, the employer intentionally refuses to hire applicants in part because of the affected individuals' sex, even if it never learns any applicant's sex.” See Bostock, 590 U.S. at 669. This therefore includes discrimination against a person because they are transgender, or because they identify in some other way that is inconsistent with their sex assigned at birth, e.g., because they are gender nonconforming. Such discrimination is also based on requiring persons to conform to stereotypical norms about sex and gender, which can also serve as the basis for impermissible sex discrimination. See, e.g., Whitaker, 858 F.3d at 1048-49 ( citing Price Waterhouse, 490 U.S. at 251). Therefore, the prohibition against discrimination based on gender identity, rather than just transgender status, more fully protects individuals from prohibited sex discrimination. Indeed, the Bostock dissent stated that, as defined by the American Psychological Association, “there is no apparent difference between discrimination because of transgender status and discrimination because of gender identity.” 590 U.S. at 686, n.6 (Alito, J. joined by Thomas, J., dissenting).

Comment: Several commenters supported OCR's general goal at § 92.101(b) of explicitly incorporating the prohibitions on discrimination found in title VI, section 504, title IX, and the Age Act and thought this approach is prudent, given that some health care entities may not be readily familiar with the specific regulatory standards and obligations that apply to them under civil rights laws. A few commenters noted that incorporating section 504 regulations pertaining to accessibility could create conflicting obligations and specifically objected to incorporating 45 CFR 84.23(c), which applies an outdated standard (the Uniform Federal Accessibility Standards) to new facility constructions. These commenters recommended including additional language in § 92.101(b)(1)(i) that expressly states “(except for § 84.23(c)).”

Response: We appreciate commenters' concerns regarding inclusion of § 84.23(c). Because the rule has a separate subsection with respect to “Accessibility for buildings and facilities,” commenters should refer to this preamble's discussion of § 92.203.

Comment: Some commenters requested that OCR restore the 2016 Rule clarification that any age distinctions exempt from the Age Act are also exempt from section 1557 enforcement.

Response: OCR appreciates commenters' request for clarity regarding the Age Act's permitted age distinctions. This rule adopts by reference the Age Act implementing regulation provisions at 45 CFR part 91 (subpart B), which explicitly recognize that some age distinctions may be necessary to the normal operation of a program or activity or to the achievement of any statutory objective. See45 CFR 91.13 (adopting statutorily permissive age distinctions found at 42 U.S.C. 6103(b)(1)).

Comment: A commenter stated that OCR should exercise its authority to enforce disparate impact claims in order to address systemic discrimination in health care.^[127] Another commenter supported the approach taken by OCR in the Proposed Rule to not include the site location provision from the 2016 Rule, stating they believed section 1557's context, structure, and text make evident that Congress did not intend to import multiple, piecemeal legal standards and burdens of proof derived from different statutory contexts into the doctrinal patchwork; and that section 1557 provides the full range of enforcement mechanisms and remedies available to any person pursuing a discrimination claim under section 1557, regardless of their protected characteristic.

Response: After reviewing comments, OCR declines to include provisions similar to former 45 CFR 92.101(b)(3)(ii) and (iii), which are not included in the 2020 Rule. OCR will preserve the longstanding treatment of discrimination in the referenced statutes' implementing regulations consistent with relevant case law.

Summary of Regulatory Changes

For the reasons set forth above and considering the comments received, we are finalizing the provision as proposed in § 92.101, with modifications. We added “or any combination thereof” after disability and deleted the “or” before disability in § 92.101(a)(1).

Subpart C—Specific Applications to Health Programs and Activities

Because of section 1557's specific application to health programs and activities, subpart C provides additional detail regarding nondiscrimination requirements in these settings. The provisions in this subpart are responsive to the nature and importance of health care, health insurance coverage, and other health-related coverage, and related health programs and activities as those health-related issues impact individuals and communities protected by section 1557's prohibition of discrimination. These provisions are intended to provide clear instruction to covered entities and are informed by OCR's experience in both enforcement and in providing technical assistance as well as outreach to interested parties.

Meaningful Access for Individuals With Limited English Proficiency (§ 92.201)

In proposed § 92.201, we proposed provisions to effectuate section 1557's prohibition on national origin discrimination as it is applied to individuals with LEP in covered health programs and activities. In § 92.201(a), we proposed that covered entities “must take reasonable steps to provide meaningful access to each limited English proficient individual eligible to be served or likely to be directly affected by its health programs and activities.”

In § 92.201(b), we proposed that language assistance services required under § 92.201(a) must be provided free of charge, be accurate and timely, and protect the privacy and independent decision-making ability of an individual with LEP.

In § 92.201(c), we proposed specific requirements for interpreter and translation services. Section 92.201(c)(1) proposed that when interpreter services are required under this part, a covered entity must offer a qualified interpreter. Section 92.201(c)(2) proposed that when translation services are required under this part, a covered entity must use a qualified translator.

In § 92.201(c)(3), we proposed regulatory language requiring a covered entity that uses machine translation to have translated materials reviewed by a qualified human translator when the underlying text is critical to the rights, benefits, or meaningful access of an individual with LEP; when accuracy is essential; or when the source documents or materials contain complex, non-literal, or technical language. We sought Start Printed Page 37579 comment on the use of machine translation in health programs and activities generally, other possible approaches to address this issue, and whether there should be an exception to this provision to allow for the limited use of machine translation in exigent circumstances.

In § 92.201(d), we addressed how the Director will evaluate compliance with this section. In § 92.201(d)(1), we proposed that the Director shall evaluate, and give substantial weight to, the nature and importance of the health program or activity and the particular communication at issue, to the individual with LEP. Proposed § 92.201(d)(2) provides that the Director shall take into account other relevant factors, including the effectiveness of the covered entity's written language access procedures for its health programs and activities, that the covered entity has implemented pursuant to proposed § 92.8(d).

In § 92.201(e), we proposed restrictions on the use of certain persons to provide language assistance services for individuals with LEP. In § 92.201(e)(1), we proposed prohibitions on covered entities from requiring individuals with LEP to provide, or pay for, their own interpreters. Proposed § 92.201(e)(2) provided for very limited situations in which an adult, not qualified as an interpreter, accompanying an individual with LEP can serve as an interpreter. Section 92.201(e)(3) proposed to prohibit a covered entity from relying on a minor child to interpret or facilitate communication, except as a temporary measure while finding a qualified interpreter in an emergency involving an imminent threat to the safety or welfare of an individual or the public where there is no qualified interpreter for the individual with LEP immediately available. In § 92.201(e)(4), we proposed prohibiting reliance on staff other than qualified interpreters, qualified translators, or qualified bilingual or multilingual staff to communicate directly with individuals with LEP.

In § 92.201(f), we proposed standards for video remote interpreting (VRI).

In § 92.201(g), we proposed standards for audio remote interpreting services.

In § 92.201(h), we proposed that nothing in this section shall be construed to require an individual with LEP to accept language assistance services.

The comments and our responses regarding § 92.201 are set forth below.

Comment: Many commenters were very supportive of § 92.201(a)'s requirement that covered entities must take reasonable steps to provide meaningful access to “each” individual with LEP eligible to be served or likely to be directly affected by its health programs and activities. Commenters also supported OCR's revision concerning individuals with LEP “likely to be directly affected” by a health program or service, as opposed to the previous “likely to be encountered,” as it provides greater clarity about the applicability of this rule and reduces some burden on health care practices. Commenters maintained that this standard provides a better description for providers to understand. Other commenters supported inclusion of “eligible to be served or likely to be directly affected” because they believe it expands the definition of who can receive language access and better reflects how language service needs are experienced by people seeking health care. Many commenters recommended that OCR clarify that companions are expressly included, noting that this is especially important for caretakers of minor children or those accompanying older adults.

Response: OCR appreciates commenters' thoughts on the language at § 92.201(a) and confirms that covered entities' language access obligations also apply to companions (defined in § 92.4), as companions are “directly affected by [a covered entity's] health programs and activities” by virtue of their relationship with the person whom they are accompanying. For example, a covered entity will need to take reasonable steps to provide meaningful access to a parent with LEP whose minor child is being treated or an individual with LEP who may be assisting their spouse with post-operative care. To reinforce this requirement, OCR is adding a parenthetical to the text of § 92.201(a) to clarify that individuals with LEP who are covered under this part include companions with LEP. This language is consistent with the requirement to provide effective communication for companions with disabilities under § 92.202.

Comment: Various commenters appreciated OCR providing clarity on the terms “reasonable steps” and “meaningful access,” noting that the 2020 Rule's deletion of meaningful access requirements was detrimental to the health of communities with LEP. A few commenters recommended that clearer directives should be included as to what types of services constitute “reasonable steps,” suggesting this could be clarified by providing examples of “reasonable steps,” or by adding definitions of “reasonable steps” and “meaningful access” to § 92.4 (Definitions). Another commenter cautioned that the lack of clarity could result in covered entities coming to the determination that no services are required of them. Others stated that additional guidance is needed specifically for providers and payers.

Response: OCR appreciates the request for additional definitions; however, we decline to provide a definition for “reasonable steps” or “meaningful access,” as these terms are not unique to section 1557 and reflect longstanding requirements under title VI. OCR will consider developing additional guidance on this topic but also refers commenters to the Department's longstanding HHS LEP Guidance, 67 FR 47311, as well as the Department's 2023 Language Access Annual Progress Report. The 2023 Progress Report describes the Department's reconstituted Language Access Steering Committee based on the HHS Equity Action Plan issued under E.O. 13985, clarifies benchmarks for meaningful language access in key areas such as developing best practices for oral interpretation and internet-based access to written translation, and sets forth current plans to update the Department's Language Access Plans and issue related guidance.^[128]

Comment: A number of commenters stated that failure to provide meaningful access may violate both section 1557's national origin prohibition and the prohibition on race discrimination. Several commenters stated that there are instances in which an individual experiences discrimination based on their limited English proficiency, in addition to another protected characteristic. For example, a person who is Black and has limited English proficiency is more likely to experience discrimination in health care settings than an individual who is Black but does not have limited English proficiency or an individual with limited English proficiency but who is not Black.^[129] Commenters stated that this type of discrimination may deter patients from seeking critical health care services, leading to adverse health outcomes and decreased trust in the health care system.^[130] Commenters also Start Printed Page 37580 provided data showing that almost one in four health center patients communicate in a language other than English; ^[131] 63 percent of individuals with LEP identify as Hispanic/Latino; ^[132] language barriers have been proven to contribute to health inequities for Asian American, Native Hawaiian, and Pacific Islander individuals in particular; ^[133] and people with LEP are less likely to receive primary care and preventive care, such as breast and cervical cancer screenings.^[134]

Some commenters also specifically addressed the importance of language assistance services for older individuals with LEP. These commenters submitted research demonstrating that it is especially difficult for older adults with LEP to communicate with providers because of limited English proficiency, low health literacy, and lack of translators and interpreters.^[135] Many commenters argued that to ensure access to quality care, covered entities must have translators and interpreters available at all points of contact at no cost to an individual. This is because older adults may be less inclined to ask for language assistance or may rely on family members who are not qualified to interpret health information. Additionally, the commenters noted that language assistance services are critical for people at the end of life who, absent these services, cannot give true informed consent or thoroughly understand their end-of-life care options.

Response: OCR appreciates these comments and the data submitted. As discussed elsewhere in this preamble, section 1557's language access requirements derive from the statute's prohibition on discrimination against national origin. OCR also appreciates, and agrees with, comments highlighting the ways in which individuals may experience discrimination on multiple grounds as well as comments about the importance of language assistance services for older individuals with LEP. The provisions for § 92.201(a) enhance health access and reduce discrimination by requiring covered entities to take reasonable steps to provide meaningful access to each individual with LEP.

Comment: Many commenters stated that language assistance has often been costly to the individuals with LEP, and translations have often been inaccurate, incomplete, or both. Commenters additionally noted that language assistance has often been provided later in time than other services and that interpretation has not been done in a way that protects patient privacy. Other commenters submitted examples of individuals with LEP being provided with incomplete information, such as being told of only one treatment option, rather than be told of other available treatment options.

Response: We appreciate concerns raised regarding cost, timeliness, and privacy concerns, which we address in § 92.201(b). Consistent with language access requirements in the 2016 and 2020 Rules, required language assistance services must be provided free of charge, be accurate and timely, and protect the privacy of the individual with LEP. Inaccurate or incomplete translations or interpretation may violate the accuracy standard found in this provision and the overarching requirement to take reasonable steps to provide meaningful access. Accuracy issues are further addressed by requiring covered entities to use the services of qualified interpreters and translators, at § 92.201(c).

Comment: Commenters noted a lack of definition for timeliness in § 92.201(b), and one recommended OCR establish time, distance, and wait time standards. Another commenter suggested that the timeliness standard take into account the geographic location of the covered entity and the hour of the day when the need for language assistance services arises.

Response: As OCR discusses in the HHS LEP Guidance, timeliness may depend on multiple variables and so no one definition would be reasonable or applicable to “all types of interactions at all times by all types of recipients.” 68 FR 47316. However, language assistance should be provided at a time and place that avoids the effective denial of the service, benefit, or right at issue or the imposition of an undue burden on or delay in important rights, benefits, or services to the person with LEP. 68 FR 47316. When evaluating a complaint, OCR will consider the context, including the urgency and importance of many health care services. We encourage covered entities to review the HHS LEP Guidance for additional guidance.

Comment: Several commenters stated that language assistance services should be required to include cultural competency and that providers should reflect the community around them in order to build trust. One commenter noted that during listening sessions they conducted, participating health centers emphasized the important role that bilingual and bicultural staff who represent the community served to provide accurate and culturally comprehensible interpretation. A few commenters recommended requiring covered entities to ensure sufficient staff with appropriate training and to administer language proficiency assessments to confirm competency of bilingual and multilingual staff.

Some commenters urged that translators and interpreters be from or a part of the impacted community in which they serve, with some suggesting that community-based interpreters and translators may be more qualified for a number of reasons, including familiarity with local dialect and cultural competency. Others, however, stated that family members and community service providers or other external groups should not have to bear the burden of interpreting.

Response: OCR generally agrees that cultural competency is essential for Start Printed Page 37581 equitable language access and communications.^[136] This is especially important considering variations in dialects, expressions, or “regionalisms.” For example, a Spanish word that may be understood to mean something for someone from Puerto Rico may mean something else for someone from Mexico. Thus, cultural competency is a key factor in providing accurate interpretation and translation, and accuracy is a necessary component of meaningful access.

OCR recognizes that community members may be more likely to be culturally competent but declines to include in the regulatory text a requirement that translators and interpreters be from the community they serve. Covered entities are free to determine their own hiring and contracting processes for utilizing the services of qualified interpreters and translators, and hiring bilingual/multilingual staff, as long as these individuals meet the requirements for their respective positions as provided in § 92.4 (Definitions).

Comment: Many commenters supported the novel proposal to address machine translation in this regulation, with some requesting that machine translation always be checked by a qualified human translator and that patients be advised when a translation has been completed by machine translation due to high error rates. One commenter specified that covered entities should not use Google Translate as the only resource for translations as it generates errors, pointing to a State Department of Health website translating “the vaccine is not required” for COVID-19 to “the vaccine is not necessary” in Spanish (since corrected). Other commenters stated that the rule does not adequately account for future innovations and that the final rule should include an exception for exigent circumstances. Insurance entities and other providers commented that machine translation is a viable option to reduce costs in some instances.

Response: OCR recognizes that machine translation is an evolving technology. However, given that it still carries significant potential for error, we believe this provision strikes an appropriate balance between the convenience some may find in this technology and the critical nature of communications in the health care context. We appreciate commenters' concerns regarding exigent circumstances, where use of machine translation technology may provide immediate language assistance capabilities in very urgent circumstances. As provided under § 92.201(a), “[a] covered entity must take reasonable steps to provide meaningful access to each individual with limited English proficiency (including companions with limited English proficiency) eligible to be served or likely to be directly affected by its health programs and activities.” For example, if an emergency medical technician must provide urgent medical care to an individual with LEP, and no other language assistance services are available, it may be reasonable to use machine translation technology to communicate with that person while a qualified interpreter is identified. We note that the definition for machine translation found at § 92.4 under this final rule “means automated translation . . . that is text based and provides instant translations between various languages,” which includes automated translation covers speech as well as written communications. However, given the importance of communication and understanding in the health care and services setting, OCR requires that in such circumstances, the machine translation must be subsequently checked by a qualified human translator as soon as practicable. OCR also recommends that, if machine translation is used in circumstances that do not require human review ( i.e., those circumstances that do not meet the criteria set forth in § 92.201(c)(3)), the patients should be warned that it may contain errors. OCR directs commenters to § 92.4 (Definitions) for further discussion on machine translation and future technology.

Comment: OCR received limited comments on our proposed revisions to the factors the Director will take into account when evaluating compliance with language access obligations (proposed § 92.201(d)). Several commenters supported discontinuing the 2020 Rule's use of the “four-factor analysis,” 45 CFR 92.101(b)(1), found in the HHS LEP Guidance, 68 FR 47314-16, to determine compliance with a covered entity's language access requirements under section 1557. These commenters stated that the four-factor analysis is too vague to be useful for oversight of compliance and does not provide direction on how each of the factors would be weighed against each other. Conversely, a few commenters recommended that OCR retain the four-factor analysis since it provides covered entities more flexibility. These commenters noted that recipients must have flexibility in achieving compliance with requirements for language access because of their limited resources and patient populations.

A few commenters noted that the phrase “other relevant factors” in § 92.201(d) is vague and should either be removed or clarified. Specifically, they said that compliance has been an ongoing problem and more information is needed to help covered entities understand the factors that will be used for evaluation of compliance. Additionally, one commenter recommended that the final rule include the geographic location of the covered entity and the hour of the day when the need for language assistance services arises as one of the factors for OCR to consider in evaluating compliance. For example, the ability of a small, rural provider to find an interpreter for an individual with LEP at midnight on a Saturday is going to be substantially more challenging than it would be for a provider in an urban setting.

Response: As discussed in the 2022 NPRM, 87 FR 47862, after additional consideration OCR determined that the four-factor test was not a sufficiently precise or flexible compliance tool. Section 92.201(d)(1) provides flexibility that allows the Director to take into account a range of relevant factors, including the “nature and importance of the health program or activity and the particular communication at issue, to the individual with limited English proficiency.” Additionally, § 92.201(d)(2) allows for the consideration of “other relevant factors,” including those that relate to whether “reasonable steps” were taken in a given situation. Thus, the Director may take into account the geographic location and timing considerations posed by the commenter's example in evaluating whether “reasonable steps” were taken.

Comment: Many commenters supported the inclusion of an explicit prohibition on the use of certain persons to interpret or facilitate communication, including the expectation that in an emergency situation, reliance on an accompanying adult or minor should be “a temporary measure” at § 92.201(e). Start Printed Page 37582 Commenters stated that children oftentimes are asked to interpret medical information for which they do not have the vocabulary or content knowledge. Some also stated that older adults with LEP may feel pressure to rely on family members as interpreters, even if those family members are not qualified to interpret health information, which can inhibit the older adult's understanding of their health status and instructions from their provider.

Response: We appreciate the commenters' support and underscore that untrained “interpreters” are more likely to make errors, violate confidentiality, and increase the risk of poor outcomes. Research has shown that the ability of a provider to accurately diagnose a patient's condition can be jeopardized by untrained interpreters, such as family and friends, and especially minor children who are prone to omissions, additions, substitutions, volunteered opinions, semantic errors, and other problematic practices.^[137] Additionally, the use of children as interpreters raises not only the same concerns as those of an accompanying adult who is not qualified as an interpreter, but also poses other problems including exposing children to complex health care interactions for which they are not developmentally prepared, upsetting a family power dynamic, causing embarrassment, and conveying incorrect or incomplete information. 87 FR 47863.

Comment: Some commenters requested that OCR provide emergency exceptions for using bilingual/multilingual staff as interpreters. These commenters noted that covered entities should be able to use their staff's skills in different languages when needed in emergency situations.

Response: We appreciate commenters' concerns regarding obtaining the services of a qualified interpreter in emergency situations. Under § 92.201(e)(2) introductory text, a covered entity may “[r]ely on an adult, not qualified as an interpreter, accompanying a limited English proficient individual to interpret or facilitate communication” as a temporary measure in an emergency pending the retention of a qualified interpreter. OCR has revised § 92.201(e)(2) introductory text to remove references limiting reliance on a non-qualified interpreter to only an adult “accompanying an individual with LEP.” This provision now allows for a covered entity to rely on a bilingual/multilingual staff member—or other adult not accompanying an individual with LEP—to serve as an interpreter as a temporary measure in such emergency situations. Furthermore, the interpreter services of bilingual/multilingual staff who are also qualified interpreters may be utilized in any situation, including emergency situations. However, covered entities should consider how to obtain the services of a qualified interpreter as quickly as possible in emergency and exigent circumstances, and only rely upon other persons in highly exceptional circumstances.

Comment: A couple of commenters recommended that OCR revise § 92.201(e)(2)(ii) to allow a covered entity to use a qualified interpreter even in situations where the patient has requested that a family member or friend interpret or facilitate communication. These commenters explained that if a provider believes that the family member or friend may not be accurately communicating with the patient or appears to be struggling when interpreting or if a health provider suspects in good faith that an individual may be a victim of trafficking or abuse, then the health provider should be able to utilize a qualified interpreter.

Another commenter recommended that OCR clarify that an accompanying adult may only facilitate communication at the request of an individual with LEP when the request is made in private, without the adult present. The commenter expressed concern that the exception as written could interfere with the autonomy of the individual with LEP seeking sexual or reproductive health services, especially if the individual is accompanied by an abusive partner that objects to certain sexual and reproductive health services.

Additionally, one commenter noted that the prohibition of an accompanying adult acting as an interpreter—absent the individual with LEP's consent or in the case of an emergency—is particularly important for survivors of domestic and sexual violence. The commenter stated that without such a restriction, victims and survivors are faced with situations where their abuser, child, or family member may be used to interpret traumatic and sensitive information, compounding the risk to victims and trauma to themselves as well as their children. Another commenter recommended OCR specify that if an individual with LEP requests an accompanying adult to facilitate one time, this does not mean the covered entity can assume the individual with LEP will continue to bring that same adult or choose to use that adult as an interpreter for future interactions. The covered entity must offer language services each and every time it encounters an individual with LEP.

One commenter requested OCR also address nonemergency situations where the patient does not “specifically request” that an accompanying adult interpret or facilitate communication, but where, despite best efforts to find a qualified interpreter, it is not possible to find a qualified interpreter for the individual with LEP, such as when a patient speaks a rare dialect of a language.

Response: We appreciate the commenters' concerns regarding when it may or may not be appropriate to grant an adult with LEP's request for an individual not qualified as an interpreter to interpret or facilitate communication. When considering reliance on an accompanying adult to interpret, the covered entity must consider whether that reliance is appropriate—this includes whether the covered entity believes the accompanying adult can adequately convey the information being discussed and whether they may have a conflict or bias, as in the case of intimate partner violence. Any agreement by a covered entity to allow an accompanying adult to interpret or facilitate communication may only be at the affirmative and independent request of the individual with LEP so as to protect individuals in situations such as intimate partner violence, abuse, or trafficking. We clarify that OCR appreciates the critical role parents and guardians play in medical decision-making for their children and that the rule does not prevent parents from being involved in their children's health care decisions. To address the concern of coercion and the like, we are finalizing § 92.201(e)(2)(ii) to include a requirement that the individual with LEP make their request without the accompanying adult present and with the services of a qualified interpreter, which does not include the exigent circumstances exception found at § 92.201(e)(2)(i).

Comment: One commenter encouraged OCR to include a specific provision at § 92.201(e) ensuring privacy and confidentiality for individuals with LEP, such as not having sensitive discussions in waiting rooms and other public spaces.

Response: We appreciate the commenter's concern regarding privacy and confidentiality for individuals with Start Printed Page 37583 LEP and restate that one of the key components of the definition of “qualified interpreter for an individual with limited English proficiency” is that they must adhere to generally accepted interpreter ethics principles, including client confidentiality. Additionally, covered entities that are subject to both HIPAA and section 1557 must comply with the requirements of both laws.^[138]

Comment: Several commenters supported the restoration of requirements related to video remote interpreting (VRI) for individuals with LEP. Commenters noted that the 2020 Rule removed requirements related to VRI for individuals with LEP, yet many covered entities use video interpreting not only for deaf or hard of hearing patients but also patients with LEP. Further, these commenters noted that the quality of video interpreting should be the same for all individuals who use it. A couple of commenters specifically noted the importance of high-quality picture, video, and transmissible audio for all parties in order for interpreters to perform their job effectively. For example, one commenter noted the importance of restoring VRI standards for individuals with LEP given frequent concerns about the poor quality of interpreter services using VRI. A couple of other commenters mentioned that the use of such technology will facilitate discussion between qualified interpreters and individuals with LEP and will also assist individuals who may have disabilities who are aided by using such technology. One commenter, who supported inclusion of VRI standards, recommended in-person interpretation should be sought as a first step because it is more responsive than VRI.

Response: We agree with commenters that it is important to have parity in VRI quality standards for all individuals who use it. The final rule reinstates the VRI standards from the 2016 Rule, former 45 CFR 92.201(f), which were based on standards found in the implementing regulations for title II of the ADA.^[139] This provision is designed to achieve parity with the VRI requirements found in § 92.202 regarding effective communication for people with disabilities.

We recognize that VRI is not always the most appropriate method for providing language assistance services. This provision does not require a covered entity to provide VRI but rather ensures that when such services are used, they meet a minimum quality standard. To also clarify that the language assistance services delivered via VRI must provide meaningful access, we are revising § 92.201(f) to require that when a covered entity uses VRI services, it “must ensure the modality allows for meaningful access.”

Comment: A few commenters raised concerns with the proposed technical requirements for VRI services. A couple of commenters requested OCR provide emergency exceptions for performance standards for video remote interpreting. These commenters also expressed concern with the requirement that VRI must be over a dedicated high-speed, wide-bandwidth video connection or wireless connection since it may be difficult to meet that standard in an emergency, such as a natural disaster that disrupts access to the high-speed connection.

Another commenter suggested revising the rule to require covered entities to use audio and video communications for interpretation services that are consistent with those available in the community served by the health program or activity. The commenter explained the communications framework in a community, such as a rural community, may not fully meet the standards proposed.

Response: We appreciate commenters' concerns regarding the ability to meet the VRI standards proposed. In the event of a natural disaster or locations where high-speed wide-bandwidth video capabilities may not be available, covered entities may not be able to meet the required standards. In these circumstances, a reasonable step to achieving meaningful access may be through using the services of a qualified interpreter via telephone (or in-person, if available). As in all circumstances, OCR will consider the specific facts of whether a covered entity has taken reasonable steps to provide meaningful access under the circumstances.

Comment: A couple of commenters recommended that VRI requirements be reflective of and adaptable to the specific community or individual. One organizational commenter recommended that the rule clarify that covered entities should follow an individual's preference with respect to interpreter services where appropriate. The commenter noted that the majority of their members and patients with LEP communicate through telephonic interpretation services and that there are also situations where a member or patient may express a preference to use an audio interpreter service rather than be required to participate in a video session.

Response: We appreciate commenters' suggestions regarding prioritizing an individual with LEP's preference when determining the manner in which interpreting services will be provided. However, we decline to revise the requirements for VRI standards. These standards set minimum requirements for when language assistance services are provided via VRI; they do not, however, require a covered entity to use such technology. Covered entities are free to use audio-only interpretation if that is a reasonable step to provide meaningful access to an individual with LEP, including if it is the expressed preference of an individual with LEP.

Comment: A few commenters recommended OCR establish further requirements with respect to VRI. These commenters suggested OCR specify that the covered entity should be held responsible for ensuring that the VRI device connects to a qualified interpreter within five minutes of the arrival of the VRI device in the room and ensure that there are no interruptions in communication, such as disconnections or screensavers. Further, commenters recommended that health care entities should have personnel available on a 24-hour basis who are trained and able to operate the VRI system efficiently. These commenters stressed that hospitals are already responsible for the maintenance and upkeep of multiple types of equipment necessary for health care and, as such, the same strict standards for optimal operation and upkeep should apply to VRI technology as well. A few commenters stated that covered entities should have policies and procedures in place to procure video remote interpretation.

Response: OCR appreciates the commenters' recommendations for providing further requirements related to VRI. The rule requires that language assistance services be provided in a timely manner. We decline to mandate a specific time period in which an interpreter must be made available once Start Printed Page 37584 a VRI device is present, as it does not allow for the necessary flexibility that may be required to account for the specific circumstances giving rise to the interaction, such as whether it is scheduled or unscheduled. We agree it is important to ensure a covered entity has personnel who can maintain and efficiently set up and operate VRI technology. To this end, the rule requires covered entities to maintain language access procedures per § 92.8(d), and to provide adequate training to users of the technology and other involved persons so that they may quickly and efficiently set up and operate the VRI device per § 92.201(f)(4). Although we support covered entities having policies and procedures in place related to the procurement of video remote interpretation, we decline to require them to do so because we do not believe imposing such a requirement is warranted at this time.

Comment: OCR received a few comments on the standards for audio remote interpreting services at § 92.201(g), which were generally supportive. One commenter expressed that audio-only interpretation is often a poor substitute for video remote or in-person interpretation and recommended OCR consider audio-only interpretation to be a last resort.

Response: We appreciate the commenter's concern and recognize that audio remote interpreting may not be adequate to provide meaningful access to an individual with LEP. However, there are situations in which audio remote interpreting may be the only option available to a covered entity and so we decline to place further restrictions on its use. To address concerns that audio remote interpreting may fail to provide meaningful access, we are revising § 92.201(g) to require that when a covered entity uses audio remote interpreting services, it “must ensure the modality allows for meaningful access.”

Comment: One commenter recommended OCR explicitly prohibit covered entities from coercing individuals with LEP to decline language assistance services, which was stated in the preamble to the 2015 NPRM. 80 FR 54185. The commenter noted that the 2022 NPRM did not capture this important concept and covered entities should be prohibited from discouraging individuals with LEP from exercising their rights, which may be a form of discrimination.

Response: We appreciate the commenter's concern and reiterate that a covered entity may not coerce an individual with LEP to decline language assistance services. In the same way that a covered entity is prohibited from requiring an individual with LEP to accept language assistance services, § 92.201(h), a covered entity similarly cannot require or coerce an individual to decline such services.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, OCR is finalizing the provisions as proposed in § 92.201, with modifications. In § 92.201(a), we are adding “(including companions with limited English proficiency)” after the term “individual with limited English proficiency.” In § 92.201(e)(2), we are deleting the clause “accompanying a limited English proficient individual.” In § 92.201(e)(2)(i), we are replacing “the accompanying adult” with “an initial adult interpreter.” In § 92.201(e)(2)(ii) we are adding the phrase “in private with a qualified interpreter present and without an accompanying adult present,” after “where the individual with limited English proficiency specifically requests.” In § 92.201(f), we are adding the phrase “ensure the modality allows for meaningful access and must . . .” after “through video remote interpreting services in the covered entity's health programs and activities must . . .” In § 92.201(g), we are adding the phrase “ensure the modality allows for meaningful access and must . . .” after “through audio remote interpreting services in the covered entity's health programs and activities must . . .”

We are also making technical revisions. Throughout § 92.201, we are replacing the term “limited English proficient individual” with “individual with limited English proficiency.” In § 92.201(c)(2), we are replacing the phrase “a covered entity must use a qualified translator” with “a covered entity must utilize the services of a qualified translator.” In § 92.201(e)(2)(ii), we are replacing the word “the” in the phrase “by the accompanying adult is documented” with “by an accompanying adult is documented.” In § 92.201(e)(4) we are striking the word “directly” as technically incorrect to describe the manner in which a covered entity communicates to an individual with LEP via the services of a qualified interpreter or qualified translator.

Effective Communication for Individuals With Disabilities (§ 92.202)

Proposed § 92.202 addressed requirements related to providing effective communication for individuals with disabilities.

In § 92.202(a), we proposed requiring a covered entity to take appropriate steps to ensure that communications with individuals with disabilities, and companions with disabilities, are as effective as communications with individuals without disabilities in its health programs and activities, incorporating the standards found at 28 CFR 35.130 and 35.160 through 35.164 of the regulation implementing title II of the ADA.

In § 92.202(b), we proposed to require covered entities to provide appropriate auxiliary aids and services to individuals with impaired sensory, manual, or speaking skills, where necessary to afford such individuals an equal opportunity to benefit from the service in question.

The comments and our responses regarding § 92.202 are set forth below.

Comment: While commenters generally expressed support for § 92.202, many discussed the extensive lack of compliance with current effective communication requirements under section 1557, section 504, and title II of the ADA by covered entities. Some referenced costs as the key issue, and one commenter stated that some providers have a policy of only providing an interpreter if the cost is covered by the patient's health insurance. Another commenter stated that even when the State has a Medicaid billing code, the patients still are faced with the burden of having to educate prospective providers about the availability of the code and the provider's obligation to provide auxiliary aids and services.

Other commenters mentioned that compliance will require implementing programs to develop, maintain, and communicate clear policies, and train on the provision of language assistance services and auxiliary aids and services for effective communication.

Response: OCR is aware that some covered entities fail to comply with their responsibility to ensure effective communication with individuals with disabilities, including through requiring an individual to bring their own interpreter, only providing interpreter services when covered by the individual's health insurance coverage or other health-related coverage, or incorrectly citing health privacy laws as a reason to not provide interpreter services.

In an effort to proactively address compliance concerns and resulting lack of access to covered health programs and activities, we are requiring all covered entities to develop and Start Printed Page 37585 maintain effective communication procedures, per § 92.8(e). OCR encourages covered entities to include any necessary billing codes in such procedures. We are further requiring covered entities to train relevant employees on these procedures, per § 92.9.

Comment: A patient advocacy group recommended requiring that states establish a medical communication access fund that pools fees from State-mandated medical licenses to pay for effective communication. The commenter expressed that this method spreads out the costs of auxiliary aids and services so that no single covered entity bears the costs.

Response: All covered entities must provide auxiliary aids and services when needed to communicate effectively with people with disabilities. OCR encourages covered entities to develop creative approaches to support the provision of these required aids and services. OCR declines to include a specific requirement for states to establish mandatory medical communication access funds in this rulemaking as such a requirement would exceed the authority granted to OCR for this rulemaking.

Comment: Some commenters expressed appreciation and support for the inclusion of “companions” in the text of § 92.202. One commenter added that doctors and hospitals have told patients that their legal counsel informed them that they are not obligated to provide communication access to anyone who is not a patient. One commenter recommended that OCR include that the selection of “appropriate” companion(s) be made by the individual not the provider.

Response: Section 1557 requires that covered entities ensure effective communication for individuals with disabilities, including companions. The definition in § 92.4 is consistent with the definition of “companion” from the implementing regulations for title II of the ADA, which similarly requires that a public entity “take appropriate steps to ensure that communications with . . . companions with disabilities are as effective as communications with others.” 28 CFR 35.160(a).

Comment: A couple of commenters mentioned that patients are sometimes told that due to confidentiality they cannot have a friend, family member, advocate, or attorney be present for an appointment for effective communication purposes. One commenter provided the following example: An individual with Autism Spectrum Disorder (ASD) was required to enter the hospital without his mom, who could assist him in communicating, and likely because of that he was misdiagnosed and required to return to the emergency room within a week.

Response: Unless a covered entity has a specific confidentiality concern regarding the presence of a specific companion, the individual with a disability should be permitted to select a companion and have them present when accessing a covered health program or activity. Further, and consistent with instruction under the ADA, a companion may need to help the patient with information or instructions given by hospital personnel.^[140] Companions may be an essential part of ensuring an individual with a disability is afforded effective communication and should not be separated from an individual with a disability outside of extenuating circumstances. However, we note that a covered entity may not rely on a person accompanying an individual with a disability to interpret or otherwise facilitate communication; this is only permitted when the individual with a disability specifically requests that an accompanying adult interpret or facilitate communication, the accompanying adult agrees to provide such assistance, and reliance on that adult for such assistance is appropriate under the circumstances. See28 CFR 35.160(c)(2)(ii), incorporated by § 92.202.

Comment: Several commenters thanked OCR for proposing to restore the requirements for quality measures in VRI, while some raised concerns regarding the appropriateness of VRI in various circumstances. They shared that, for example, VRI may not be effective for a person lying on their back for a medical procedure due to challenges with viewing the screen and that VRI has been inappropriately used during high-risk childbirth. Yet another commenter mentioned that VRI is not appropriate for individuals who are deafblind ( i.e., individuals who have combined hearing and vision loss that limit access to both auditory and visual information). One commenter expressed concern that a provider made it a policy that their facility only uses VRI and never uses the services of in-person interpreters.

Response: We acknowledge the concerns with VRI and note that it may not provide effective communication for all individuals in all situations. Covered entities are required to take appropriate steps to ensure that communications with individuals with disabilities are as effective as communications with individuals without disabilities in their health programs and activities. If the use of VRI does not provide an individual equal opportunity to participate in or benefit from the service in question, then the communication is ineffective and does not meet section 1557 requirements.

Several cases have found that VRI was ineffective due to hospital staff's lack of knowledge about how to operate the VRI equipment or technology issues with the equipment itself, including the attempted use of VRI during labor.^[141] Settlement agreements with the United States have similarly found concerns with VRI, including one settlement decree that specified that VRI would not be considered effective in specific situations, including situations due to: “(1) a patient's limited ability to move his or her head, hands or arms; vision or cognitive issues; or significant pain; (2) space limitations in the room; (3) the complexity of the medical issue; or (4) any other time when there are indicators that VRI is not providing effective communication.” ^[142]

This enforcement activity suggests that VRI may not always afford a person with a disability an equal opportunity to participate in and enjoy the benefits of the program or activity of a covered entity. Thus, policies that require the exclusive use of VRI, or the exclusive use of any particular auxiliary aid or service, are likely to result in the eventual failure to provide effective communication and therefore should not be adopted.

Comment: One patient advocacy group recommended that OCR emphasize that family members should not act as interpreters for a deaf or hard of hearing patient, except in certain exigent circumstances. Start Printed Page 37586

Response: Covered entities are responsible for providing effective communication, including through utilizing the services of a qualified interpreter, and cannot require an individual to bring someone to interpret for them. Persons with disabilities can, however, bring an interpreter of their choosing, including a family member, and OCR declines to add the suggested language prohibiting this choice. This approach is consistent with existing ADA title II regulations, 28 CFR 35.160(c), and with the approach OCR has followed in the section 504 proposed rule. 88 FR 63392, 63508 (Sept. 14, 2023) (proposed 45 CFR 84.77(c)(2)(ii)).

Comment: One group recommended that the final rule include language that requires health care entities to consider a patient's preference for gender of the interpreter as a means of ensuring more effective communication. This group noted that given the intimate nature of medical assessments and treatments, patients may not be comfortable with an interpreter of a different gender than themselves, particularly in settings that involve nudity such as in an obstetrics and gynecology appointment.

Response: While OCR appreciates that a patient may prefer an interpreter of a particular gender and recommends consideration of a patient's preference for a particular gender whenever possible, including when the request is made based on an individual's religious practices and beliefs, we decline to include such language in the rule regarding the gender of a qualified interpreter for an individual with a disability. OCR notes that some organizations, such as the National Association of the Deaf and Deaf Seniors of America, have issued position statements to guide providers in adopting internal VRI policies, and have stated that medical providers “shall honor the preference of the deaf or hard of hearing patient and/or companion with respect to the gender of video interpreter.” ^[143] However, OCR notes that whether a covered entity has ensured their communication is effective for an individual with disability does not inherently depend on whether the covered entity is able to satisfy a patient's preference regarding the interpreter's gender.

Comment: An organizational commenter said that providers should be required to “affirmatively ask” patients what they need to make documents accessible and should document that requirement so that it does not need to be repeatedly asked and answered.

Response: OCR understands the frustration experienced by individuals who have to inform their providers of their need to receive communication in accessible formats multiple times. We note that the Department has implemented a process by which Medicare beneficiaries who are blind or have low vision can request Medicare Summary Notices in an accessible format, and following the initial request, the required accessible format will be the default format of the document mailed to the beneficiary.^[144] We recognize this as a best practice, and while we decline to require that such need be documented, we encourage covered entities to implement such a practice in the written effective communication procedures required under § 92.8(e).

Comment: Some organizational commenters urged OCR to incorporate the following OCR guidance documents directly into the final regulations, as well as all subsequent similar guidance, technical assistance, and enforcement activities: enforcement efforts related to support persons in hospital settings ^[145] and Bulletin on Civil Rights, HIPAA, and the Coronavirus Disease 2019.^[146]

Response: OCR thanks commenters for their suggestion to incorporate guidance and enforcement materials into the final rule. Guidance documents advise members of the public how an agency understands its legal authorities.^[147] Similarly, covered entities and others may be able to look to OCR's enforcement to gain clarity regarding regulatory requirements. As guidance, technical assistance, and enforcement activities are constantly evolving, we decline to codify the referenced materials in this rule.

Comment: Multiple commenters, including organizations, recommended that § 92.202(b) explicitly parallel the language in § 92.201(b) by stating that auxiliary aids and services must be provided free of charge, be accurate and timely, and protect the privacy and the independent decision-making of the individual with a disability. The commenters noted that while this section adopts by reference 28 CFR 35.160 through 35.164 (ADA title II communication requirements), some covered entities may simply read the regulatory language and note the difference in language between §§ 92.201 and 92.202. Noting this difference, several commenters also requested that OCR develop technical assistance materials on 28 CFR 35.160 through 35.164 in plain language.

Response: Like multiple places in this regulation, the text of § 92.202 adopts ADA title II standards by reference, including the requirements related to auxiliary aids and services. OCR appreciates the concerns raised by commenters regarding the apparent lack of parity between §§ 92.201(b) and 92.202(b), and how this may lead to confusion on behalf of covered entities and the public and may increase the likelihood that individuals with disabilities may either not receive or may be required to pay for auxiliary aids and services. Therefore, in light of comments received and continued compliance concerns, we are revising § 92.202(b) as follows.

First, OCR is revising the text, consistent with 28 CFR 35.160(b)(1), to clarify that all individuals with disabilities must be afforded appropriate auxiliary aids and services and an equal opportunity to “participate in and enjoy the benefits of” the health program or activity in question.

Further, OCR agrees with commenters that it is important that those reading this regulation can immediately identify that appropriate auxiliary aids and services must be provided free of charge. Some commenters and our enforcement experience demonstrate that this requirement, similar to that in the ADA and section 504, is not always clear or adhered to by covered entities. Thus, OCR is adding a sentence to § 92.202(b) stating that auxiliary aids and services must be provided free of charge. OCR notes that this is similar to the approach taken in DOJ's implementing regulations for title II and title III of the ADA, which forbid surcharges on persons with disabilities or groups of persons with disabilities to Start Printed Page 37587 cover the provision of auxiliary aides and services. 28 CFR 35.130(f) (title II), 36.301(c) (title III). For parity with 28 CFR 36.160(b)(2) and 45 CFR 92.201(b), we are also revising the text to clarify that auxiliary aids and services must be provided in accessible formats, in a timely manner, and in such a way to protect the privacy and the independence of the individual with a disability.

OCR appreciates commenters' suggestion to develop technical assistance materials regarding effective communication under 28 CFR 35.130 and 35.160 through 35.164. These are regulations promulgated and enforced by DOJ, and we will continue to coordinate and collaborate with DOJ to develop technical assistance materials related to effective communication requirements under our respective authorities.^[148]

Comment: A few organizational commenters argued that the provision of auxiliary aids and services is necessary but not a sufficient tool for avoiding and remedying effective communication discrimination. The commenters said that individuals who cannot rely on natural speech for effective communication require “effective access to the robust language-based alternative and augmentative communication they need to express themselves and be understood.” Another group said that OCR should expand on the definition of “auxiliary aids and services” to include plain language and screen reader capabilities.

Response: Covered entities are required take appropriate steps to ensure effective communication. Though the provision of appropriate auxiliary aids and services is addressed in § 92.202(b), the examples of auxiliary aids and services provided at § 92.4 (Definitions) is non-exhaustive and covered entities may use additional auxiliary aids and services to achieve effective communication.

Effective communication for patients with cognitive, neurological, and psychiatric disabilities may require auxiliary aids and services or strategies different from those employed with patients with other disabilities. For example, while an individual who is deaf or hard of hearing may require an ASL interpreter to effectively communicate with a provider, an individual with a cognitive disability may require additional time with the provider to ask questions and receive plain language answers about a specific health care decision.

In addition, one type of auxiliary aid or service that may be required is the acquisition or modification of equipment or devices, including for augmentative and alternative communication, and the provision of training and assistance to the individual with a disability on how to use them. Augmentative and alternative communications devices include, but are not limited to, speech generating devices, single-message devices, computers, tablets, smartphones, amplification devices, telecommunications devices, voice amplifiers, artificial phonation devices, picture and symbol boards, paper-based aids, and other equipment or devices used to compensate for impairments to speech-language production or comprehension, including spoken and written modes of communication. In some instances, the use of augmentative and alternative communication is necessary for individuals with certain disabilities that impair speech production and comprehension to access vital health and human services programs and activities. Often, the most effective way for recipients to ensure effective communication is to provide training on the use of this equipment.

Comment: A health care organization requested that this provision should be modified to state that covered entities “must make a reasonable attempt” to provide auxiliary aids and services, “unless the covered entity can demonstrate that providing such auxiliary aids or services would fundamentally alter the nature of the service in question or result in an undue burden, i.e., significant difficulty or expense.”

Response: OCR declines to modify the standard for effective communication, which requires that covered entities ensure that communications with people with disabilities are as effective as communications with others. The language on fundamental alteration or undue burden related to the provision of communications, found in 28 CFR 35.164, is already adopted into this section by reference.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.202, with modification. We are revising § 92.202(b) to read: “A covered entity must provide appropriate auxiliary aids and services where necessary to afford individuals with disabilities an equal opportunity to participate in, and enjoy the benefits of, the health program or activity in question. Such auxiliary aids and services must be provided free of charge, in accessible formats, in a timely manner, and in such a way to protect the privacy and the independence of the individual with a disability.”

Accessibility for Buildings and Facilities (§ 92.203)

In § 92.203, we proposed adding a general provision establishing that no qualified individual with a disability shall, because a covered entity's facilities are inaccessible to or unusable by individuals with disabilities, be denied the benefits of, be excluded from participation in, or otherwise be subjected to discrimination under any health program or activity to which this part applies, consistent with OCR's section 504 regulation. OCR also proposed incorporating the identical language found in the 2020 Rule at § 92.103, except that the definitions for 1991 Americans with Disabilities Act Standards for Accessible Design (1991 ADA Standards), 2010 ADA Standards for Accessible Design (2010 ADA Standards), and Uniform Federal Accessibility Standards (UFAS), Public Law 90-480; 42 U.S.C. 4151 et seq., are now located in § 92.4.

OCR also notes that the section 504 regulatory provisions incorporated into subpart B in this regulation contain program accessibility requirements that apply to existing facilities as well as new construction and alterations. Title II of the ADA and section 504 require that covered entities operate their programs and activities so that, when viewed in their entirety, they are readily accessible to individuals with disabilities; neither statute has been interpreted to require that each existing facility be made accessible.^[149] Nearly all of the entities subject to the facility access requirements in the final rule are also subject to facility access requirements under section 504 and the ADA. Section 92.203 establishes specific accessibility standards for new construction and alterations under section 1557.

The comments and our responses regarding § 92.203 are set forth below.

Comment: Some commenters emphasized the importance of a Start Printed Page 37588 continued push towards universal compliance with the 2010 ADA Standards. Many commenters also noted how critical it would be for OCR to provide oversight to ensure that covered entities' buildings and facilities come into compliance with the 2010 ADA Standards. These commenters also noted that the uniform application of the 2010 ADA Standards will also enable greater consistency among implementing agencies.

Response: OCR appreciates the comments regarding the existing standards and the push towards universal compliance with the 2010 ADA Standards and will continue to retain the requirement that new construction or alteration of buildings or facilities must comply with the 2010 ADA Standards.

Comment: Some commenters did not support the incorporation of 45 CFR 84.23(c) at § 92.101(b) because they stated it would allow facilities to only conform with UFAS instead of the more recent 1991 ADA Standards or 2010 ADA Standards. They also expressed concern that the application of the UFAS to new facilities would be outdated. These commenters believe that the UFAS permits facilities to maintain barriers that exclude people with disabilities that impact their mobility or strength.

Response: OCR appreciates the commenters concerns regarding the incorporation of the UFAS. However, this rule does not allow UFAS to be used as the accessibility standard for new facilities. UFAS is only used to determine if a building built before July 18, 2016, was designed and constructed in accordance with the standards at the time. Any alteration or addition of any building or facilities built after July 18, 2016, must follow the 2010 ADA Standards.

Comment: Some commenters also recommend incorporating existing standards relating to accessible Medical and Diagnostic Equipment (MDE) that were developed by the U.S. Access Board. 82 FR 2810 (Jan. 9, 2017), codified at 36 CFR part 1195 (U.S. Access Board 2017 Standards for MDE). Commenters also noted that the lack of access to MDE should constitute both a discriminatory benefit design and network inadequacy.

Response: On September 14, 2023, OCR published a NPRM proposing modifications to the implementing regulations for section 504. The NPRM proposes adopting the U.S. Access Board 2017 Standards for MDE used by recipients of Federal financial assistance to ensure accessibility for patients with disabilities. 88 FR 63450-55, 63511 (proposed 45 CFR 84.92). OCR will continue to address accessible MDE in that rulemaking.

Summary of Regulatory Changes

For the reasons set forth above and considering the comments received, we are finalizing the provisions as proposed in § 92.203 with modification. We are making two technical corrections to add “or alteration” after “construction” in § 92.203(b) and (c) for consistency with the description of the 2010 Standards elsewhere in the provision. We have replaced the phrase “and such facility was not covered by the 1991 Standards or 2010 Standards” in § 92.203(c) with “and such facility would not have been required to conform with a different accessibility standard under 28 CFR 35.151” for clarity and consistency. We have also added language clarifying the timeframes for compliance with either the 2010 Standards or the UFAS standards for existing facilities where construction or alteration was begun on or after July 18, 2016, and on or before January 18, 2018, in conformance with UFAS but the facility or part of the facility was not covered by the 2010 Standards. That addition reads, “If construction or alteration was begun on or after July 18, 2016, and on or before January 18, 2018, in conformance with UFAS, and the facility or part of the facility was not covered by the 2010 Standards prior to July 18, 2016, then it shall be deemed to comply with this section requirements of this section and with 45 CFR 84.23(a) and (b).”

Accessibility of Information and Communication Technology for Individuals With Disabilities (§ 92.204)

Proposed § 92.204 addressed the accessibility of information and communication technology (ICT) for individuals with disabilities.

In § 92.204(a), OCR proposed requiring covered entities to ensure that their health programs and activities provided through ICT are accessible to individuals with disabilities, unless doing so would result in undue financial and administrative burdens or a fundamental alteration in the nature of the health programs or activities. If an action required to comply with this subpart would result in such an alteration or burdens, a covered entity is required to take any other action that would not result in such an alteration or burdens but would nevertheless enable, to the maximum extent possible, individuals with disabilities to receive the benefits or services of the health program or activity provided by the covered entity.

In § 92.204(b), OCR proposed requiring recipients and State Exchanges to ensure that their health programs and activities provided through websites and mobile applications comply with the requirements of section 504 as interpreted in a manner consistent with title II of the ADA.

Given the crucial role that ICT can play for individuals with disabilities accessing health programs and activities, OCR sought comment on whether the section 1557 rule should include a provision requiring covered entities to comply with specific accessibility standards, such as the Web Content Accessibility Guidelines (WCAG) developed by the Web Accessibility Initiative. Additionally, OCR invited comments on whether to adopt a safe harbor provision under which covered entities that are in compliance with established specific accessibility standards are deemed in compliance with proposed § 92.204(a) and (b); whether OCR should require covered entities to comply with the most recent edition of a published standard; and the timeline necessary for covered entities to come into compliance with a new standard.

The comments and our responses regarding § 92.204 are set forth below.

Comment: Many commenters, including civil rights groups, health care organizations, and a group of Federal elected officials, expressed general support for the ICT requirements for people with disabilities in the Proposed Rule. Several commenters said they are concerned that this section only focuses on accessibility for individuals with disabilities, saying that this section should be applicable to all individuals covered by section 1557. These commenters noted that section 1557's nondiscrimination mandate guards against discrimination on the basis of race, color, national origin, sex, and age, as well as disability. Therefore, these commenters recommended that § 92.204 provide that covered entities must ensure that their health programs or activities provided through ICT are accessible to individuals on all protected bases, not just disability.

Response: Section 92.204 prohibits discrimination based on disability in health programs and activities provided through ICT because individuals with certain disabilities are often unable to access certain aspects of ICT when that ICT is not developed to be accessible. For example, OCR has received complaints from people with disabilities, including those who are blind or have low vision, alleging that the ICT of covered entities is Start Printed Page 37589 inaccessible to them and not compatible with screen reader software, resulting in a denial of access to health programs and activities. While § 92.204 addresses ICT accessibility issues for individuals with disabilities, it does not limit the application of general nondiscrimination principles found throughout section 1557 regulations to the accessibility of health programs and activities offered through ICT to other groups. Thus, the general prohibition against discrimination set forth in § 92.101(a) requires the accessibility of health programs and activities offered through ICT, without discrimination on the basis of race, color, national origin, sex, age, or disability.

Comment: Several groups recommended adding that “covered entities must procure, design, maintain and use accessible ICT in all aspects of providing health programs and activities” to remind covered entities that their civil rights obligations apply in procurements. One group said that OCR should clarify that covered entities should be aware that third-party providers of ICT are not directly covered by this regulation, and that covered entities are obligated to ensure that they procure ICT that is accessible. Several commenters suggested the use of a Voluntary Product Accessibility Template,^[150] a document that indicates compliance with section 508 standards,^[151] should be completed by the third-party vendors.

Response: Regardless of the method that a covered entity uses to acquire ICT, the health programs and activities it provides through that ICT must be accessible to individuals with disabilities. Due to the increasing importance of ICT in the provision of health care, health insurance coverage, and other health-related coverage, OCR will continue to closely monitor this area. Both OCR and DOJ recently issued NPRMs addressing the accessibility of web content and mobile apps used by recipients of Federal financial assistance and public entities, respectively.^[152] Those rulemakings provide greater clarity on obligations to ensure that web content and mobile applications are accessible.

Comment: An organizational commenter asked OCR to provide more guidance on what constitutes undue burden or fundamental alteration.

Response: This rulemaking does not create a different standard for fundamental alteration or undue burden beyond the standards in section 504 and the ADA. As DOJ noted in its August 4, 2023 NPRM, Nondiscrimination on the Basis of Disability; Accessibility of Web Information and Services of State and Local Government Entities, there are current undue burden and fundamental alteration limitations in the ADA title II regulation that are familiar to public entities. 88 FR 51948, 51978. The current limitations are in the ADA title II implementing regulation at 28 CFR 35.150(a)(3) (program accessibility) and 35.164 (effective communication) for fundamental alteration and undue burden limitations and 28 CFR 35.130(b)(7) (reasonable modifications in policies, practices, or procedures) for fundamental alteration limitations. DOJ also provides additional context for fundamental alteration and undue burden on its ADA.gov website.^[153] Additionally, DOJ's technical assistance manual on title III of the ADA provides guidance on what constitutes fundamental alteration and undue burden for public accommodations under title III.^[154]

Comment: A professional association asked OCR to work with small, independent, and under-resourced physician practices to ensure they have the resources, tools, and financial assistance necessary to ensure ICT accessibility for patients with disabilities.

Response: OCR will continue to develop technical assistance and educational materials to assist covered entities' compliance with section 1557 and this regulation. However, we are unable to provide other resources or financial assistance to ensure ICT accessibility.

Comment: One organizational commenter said that OCR should provide technical assistance to covered entities servicing populations with digital inequities, such as populations of older adults that may not be as digitally savvy or individuals who do not have stable internet connections.

Response: OCR recognizes that many people lack internet connectivity and may therefore be unable to access web-based tools and resources provided by covered entities, and OCR encourages entities to develop creative means to meet the needs of these individuals. However, though this issue may raise civil rights concerns in some contexts, it is outside the scope of this regulation.

Covered entities have general nondiscrimination obligations under § 92.101(a), including that a covered entity may not discriminate based on age. Accordingly, covered entities that use web-based health programs and activities must ensure that older adults are not denied participation, denied benefits, or otherwise discriminated against in the provision of those web-based health programs and activities. For example, a covered entity may not decline to provide an electronic appointment reminder to an older individual because of a stereotype that older individuals may experience difficulties using such technology.

Comment: One organizational commenter recommended extending the full ICT requirements to recipients and State exchanges.

Response: Recipients and State Exchanges are required to comply with both § 92.204(a) and (b), per the text of the section.

Comment: Multiple commenters requested the explicit inclusion of mobile applications within this section. They stated that it would spur greater awareness among software developers of the need for fully accessible mobile applications that are also compatible with mobile devices and internet platforms. One organizational commenter warned that there could be privacy concerns with certain mobile apps used for substance use disorder treatment and recommended that OCR collaborate with the Substance Abuse and Mental Health Services Administration (SAMHSA) to determine if Federal privacy laws apply to mobile application health information, and communicate that information to consumers.

Response: OCR appreciates these comments. Mobile applications are a form of information and communication technology and are explicitly included in the regulatory text under § 92.204(b); thus, to the extent covered entities use mobile applications as part of their health programs and activities they must be accessible for individuals with disabilities. Though privacy protections are outside of the scope of this rulemaking, OCR reminds commenters Start Printed Page 37590 that it has issued guidance on the application of the HIPAA Privacy, Security, and Breach Notification Rules to mobile health apps.^[155]

Comment: Many commenters recommended OCR require covered entities to comply with specific accessibility standards, such as section 508 standards, the WCAG 2.0 standards, the WCAG 2.1 standards, or other standards that provide equal or greater accessibility. Several commenters, including organizations, recommended requiring covered entities to comply over time with the latest WCAG as they are updated by the Web Accessibility Initiative of the World Wide Web Consortium (W3C). The commenters also said that a requirement to adhere to the latest standards could offer a range of time for compliance, with larger entities that have more resources being required to comply with a new WCAG standard within a shorter timeline than smaller entities. A technology company said that OCR should not establish a requirement to conform to the latest standard, but rather a requirement to conform to technical specifications that are proven and generally accepted for achieving and maintaining reasonable levels of accessibility; currently that is WCAG 2.1 levels A and AA.

Some organizational commenters suggested that OCR should incorporate a functional, evergreen standard for accessibility that will adapt to changes in technology and accessibility practices. Such a standard would require the ICT to be perceivable, operable, understandable, and robust, and “enable individuals with disabilities to access the same information as, to engage in the same interactions as, to communicate and to be understood as effectively as, and to enjoy the same services offered to other individuals with the same privacy, same independence, and same ease of use as, individuals without disabilities.”

Several commenters, including health care organizations, advocacy groups, and a trade association, offered suggestions for the timeline for compliance with new standards. These included 60 days, 12 months, 18 months, and 2 years. A health care organization recommended that OCR only require initial compliance in fields that are “critical to utilizing telehealth services” and that covered entities be required to meet the minimum conformance levels of the two most recent versions of the W3C guidelines.

Some commenters supported compliance with accessibility standards, provided that OCR conducts real-world testing with successful results across a variety of physician offices before requiring compliance. The commenter also suggested that OCR work with the Office of the National Coordinator for Health Information Technology and vendors to ensure that compliance does not place an undue financial or administrative burden on physician practices. Expressing concern about the cost of compliance, a professional association requested an exemption for businesses classified as small businesses by the Small Business Administration.

A few commenters, including a trade association, health care organizations, and health insurance entities, suggested that OCR establish a safe harbor by which covered entities compliant with WCAG 2.1 Level AA are deemed in compliance with the section 1557 requirements. Other commenters argued that OCR should not establish a safe harbor because compliance with a set of accessibility standards is not necessarily evidence of compliance with accessibility requirements; there may be ICT that meets published standards but remains inaccessible. Another commenter said OCR should not establish a safe harbor because the ADA, the Rehabilitation Act, and other Federal laws must continue to provide standalone protections.

Response: OCR appreciates commenters' input on this important topic but has decided not to adopt specific accessibility standards or a safe harbor at this time. This is in part due to OCR and DOJ recently publishing NPRMs proposing specific accessibility requirements for section 504 and title II of the ADA, respectively.^[156] Those NPRMs propose to require that recipients of Federal financial assistance and public entities must ensure that their web content and mobile applications comply with set accessibility standards. In this rulemaking, OCR continues to require covered entities to ensure that health programs and activities provided through ICT are accessible to individuals with disabilities sufficient to provide equal access to the health program or activity, unless doing so would impose undue financial and administrative burdens or would result in a fundamental alteration in the nature of the entity's health program or activity. OCR strongly encourages covered entities that offer health programs and activities through ICT to incorporate current WCAG standards as they take steps to ensure that those programs and activities comply with requirements of this regulation and other Federal civil rights laws.

Summary of Regulatory Changes

For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.204, without modifications.

Requirement To Make Reasonable Modifications (§ 92.205)

In § 92.205, we proposed requiring covered entities to make reasonable modifications to policies, practices, or procedures when such modifications are necessary to avoid discrimination on the basis of disability, unless the covered entity can demonstrate that making the modifications would fundamentally alter the nature of the health program or activity. Section 92.205 is the same as § 92.205 in the 2016 Rule and § 92.105 in the 2020 Rule. The term “reasonable modifications” will be interpreted as set forth in the regulation implementing title II of the ADA at 28 CFR 35.130(b)(7), such that “[a covered entity] shall make reasonable modifications in policies, practices, or procedures when the modifications are necessary to avoid discrimination on the basis of disability, unless the [covered entity] can demonstrate that making the modifications would fundamentally alter the nature of the [health] service, program, or activity” and “[a covered entity] is not required to provide a reasonable modification to an individual who meets the definition of `disability' solely under the `regarded as' prong of the definition of `disability' at § 35.108(a)(1)(iii).”

The comment and our response regarding § 92.205 are set forth below.

Comment: One commenter urged OCR to strengthen the section by adding language to clarify that a modification to add something that is medically necessary for individuals with disabilities, or to eliminate exclusions related to medically necessary services, are not considered fundamental alterations to the nature of the health program.

Response: OCR appreciates the commenter's request for clarifying language related to fundamental alterations. In promulgating this rule, OCR cannot address how the requirements of section 1557 apply to every scenario that may arise. OCR also Start Printed Page 37591 cannot state every modification that could result in a fundamental alteration because determining whether a modification is a fundamental alteration is a fact-specific process.

Summary of Regulatory Changes

For the reasons set forth above and considering the comments received, we are finalizing the provisions as proposed in § 92.205, without modification.

Equal Program Access on the Basis of Sex (§ 92.206)

OCR proposed a section clarifying covered entities' obligation to ensure equal access to their health programs and activities without discrimination on the basis of sex.

In proposed § 92.206(a), we described a covered entity's general obligation to provide individuals equal access to the covered entity's health programs or activities without discrimination on the basis of sex.

In proposed § 92.206(b)(1) through (4), we clarified certain types of discriminatory actions that would be prohibited for a covered entity in its provision of access to health programs or activities.

In § 92.206(b)(1), we proposed prohibiting a covered entity from denying or limiting health services, including those that are offered exclusively to individuals of one sex, to an individual based on the individual's sex assigned at birth, gender identity, or gender otherwise recorded.

In § 92.206(b)(2), we proposed prohibiting covered entities from denying or limiting a health care professional's ability to provide health services on the basis of a patient's sex assigned at birth, gender identity, or gender otherwise recorded.

In § 92.206(b)(3), we proposed prohibiting a covered entity from applying any policy or practice of treating individuals differently or separating them on the basis of sex in a manner that subjects any individual to more than de minimis harm.

In § 92.206(b)(4), we proposed prohibiting a covered entity from denying or limiting health services sought for the purpose of gender-affirming care that the covered entity would provide to a person for other purposes if the denial or limitation is based on a patient's sex assigned at birth, gender identity, or gender otherwise recorded.

In § 92.206(c), we proposed that nothing in this section requires the provision of any health service where the covered entity has a legitimate, nondiscriminatory reason for denying or limiting that service, including where the covered entity reasonably determines that such health service is not clinically appropriate for that particular individual.

In § 92.206(d), we proposed that the enumeration of specific forms of discrimination in paragraph (b) does not limit the general applicability of the prohibition in paragraph (a).

The comments and our responses regarding § 92.206 are set forth below.

Comment: Numerous commenters supported OCR's proposal to specifically address equal access on the basis of sex in the final rule. A supporter of the provision argued that patients who trust their provider not to discriminate against them will share better information, enabling better treatment. Some commenters specifically requested this section be strengthened by including specific examples of what constitutes discrimination based on sex characteristics.

Response: OCR agrees that open communication between a provider and their patient is a bedrock of the provision of quality care, and that cannot happen where the patient experiences or expects that they will face discrimination by the provider. In addition, we note that the question of whether prohibited discrimination has occurred is often context specific and fact intensive, so it is difficult to provide succinct examples of scenarios that would constitute prohibited discrimination in each and every instance.

Comment: Commenters urged OCR to include specific language related to reproductive health care and fertility treatments in §§ 92.206 and 92.207. A few commenters urged OCR to specify the full range of reproductive health care protected from discrimination under section 1557, including protections against discrimination based on reproductive health decisions. A few commenters said the final rule should make clear that section 1557 prohibits discrimination related to maternity care, such as failing to provide accessible medical equipment or transfer assistance, leaving wheelchair users unable to access care. Another commenter opined that the final rule should make clear that section 1557 prohibits discrimination relating to treating pregnancy emergencies and complications, including termination of pregnancy, miscarriage management, and other pregnancy outcomes.

Response: Matters related to reproductive health care, fertility, pregnancy, family status, and maternity care are addressed in § 92.208, and OCR refers commenters to that section. Covered entities must ensure accessibility of their health programs and activities for individuals with disabilities, which includes accessible equipment and transfer assistance.

Comment: Some commenters argued that it would be more appropriate to address the impacts of the Dobbs decision and protections against discrimination on the basis of obtaining an abortion in § 92.206 rather than in § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status), because addressing abortion in the section on marital, parental, or family discrimination could convey that denying abortion care is only discriminatory in those contexts.

Conversely, many commenters expressed opposition to the inclusion of termination of pregnancy within the scope of equal program access on the basis of sex, primarily stating that the rule would force health care professionals to perform abortions or deem their refusal to do so discrimination.

Response: OCR appreciates commenters' feedback regarding the addition of pregnancy or related conditions in § 92.206 rather than in § 92.208. Based on a review of the totality of the comments, additional language has not been added to § 92.206, and we discuss this issue further in § 92.208. Further, the ACA itself provides that “[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.” 42 U.S.C. 18023(c)(2)(A). OCR will comply with this provision. For further discussion regarding a health care professional's decision not to provide an abortion, including due to a sincerely held religious belief or conscience objection to performing the procedure, see §§ 92.208 and 92.302.

Comment: Many commenters recommended that in addition to the specific forms of discrimination based on gender identity, it is important to include specific forms of reproductive health and pregnancy-related care discrimination in § 92.206(b). Many commenters recommended incorporating a provision or provisions under § 92.206(b) to clarify that covered entities are prohibited from denying or limiting services—or denying or limiting a health professional's ability to provide services—based on a patient's Start Printed Page 37592 pregnancy or related conditions, including termination of pregnancy, contraceptive use, miscarriage management, assisted reproduction, fertility care, and pregnancy-related services. One of these commenters recommended that the language of this provision not be limited to reproductive or sexual “health care decisions,” as covered entities also discriminate based on reproductive and sexual health histories such as past experiences with sexual violence, which exist beyond the realm of services and that including “care” here could limit how covered entities understand this form of discrimination. Some commenters also stated that failure to codify some of the most prevalent forms of sex discrimination will directly undermine efforts to implement proposed §§ 92.101 and 92.206.

Response: OCR appreciates the recommendations regarding discrimination based on pregnancy or related conditions, including the request to provide additional examples, and directs commenters to the discussion at § 92.208. The rule does not include language related to discrimination based on health care decisions. The rule is not so limited—it prohibits discrimination in health programs and activities generally. This includes discrimination on the basis of sex in the context of health decisions or histories related to reproductive and sexual health.

Comment: Many commenters supported § 92.206 as important to ensure access to necessary health services that might otherwise be denied to people due to discrimination on the basis of sexual orientation or gender identity, with many providing specific examples of discrimination faced by LGBTQI₊ individuals. Some commenters recommended specifically addressing protections for LGBTQI₊ people seeking fertility treatments. A commenter recommended that OCR consider adding a subsection to § 92.206 or § 92.208 to discuss the prohibition of discrimination on the basis of sexual orientation and gender identity in access to fertility services, and provided examples of the numerous barriers that LGBTQI₊ individuals and same-sex couples face in accessing this type of reproductive health care.

Response: Section 1557 and this rule prohibit discrimination on the basis of sex, including sex characteristics, sexual orientation, and gender identity, in health care access. Depending on the specific facts at issue, barriers described may rise to the level of discrimination and would be evaluated under this rule's general prohibition of discrimination under § 92.101(a)(1), to make a case-by-case determination as to whether prohibited discrimination has occurred. In general, OCR anticipates that if a covered entity elects to provide or cover fertility services, but categorically denies them to same-sex couples or to individuals on the basis of sexual orientation or gender identity, such a denial of care or coverage may violate section 1557's prohibition on sex discrimination. We decline to add such specific language to the regulatory text as proposed.

Comment: Commenters recommended that OCR should add language to § 92.206(b) affirming that section 1557 prohibits covered entities from denying, limiting access to, or otherwise placing special caps, costs, or additional procedural requirements on medications or treatments needed specifically by people with disabilities, irrespective of whether those medications or treatments can also be used to end or complicate pregnancies or fertility.

Response: We address special caps, costs, or additional procedural requirements related to health insurance coverage and other health-related coverage in § 92.207, and direct commenters to that section. A discussion of medications and treatments related to pregnancy and fertility care is in § 92.208.

Comment: Many commenters recommended including “transgender status” in § 92.206(b)(1), (2), and (4) because there have been instances in which those seeking to permit discrimination against transgender people have justified it by pressing distinctions between transgender status and gender identity.

Response: As noted in the discussion for § 92.101(a)(2), the term “gender identity” necessarily encompasses transgender status and the two terms are often used interchangeably.^[157] We decline to enumerate the full range of identities protected under the term “gender identity.”

Comment: Multiple commenters expressed support for the rule's prohibition on denying or limiting care on the basis of a patient's assigned sex at birth, gender identity, or gender otherwise recorded at § 92.206(b)(2). A commenter expressed support for the rule's prohibition on covered entities denying or limiting a clinician's ability to provide clinically appropriate care when the failure to do so would constitute discrimination.

Another commenter supported this provision, arguing that it is necessary to ensure that specialists and providers who see LGBTQI+ patients every day do not experience retaliation for providing care. Pointing to State legislative efforts seeking to restrict or ban providers from offering safe and effective treatment to LGBTQI₊ patients, the commenter argued that such protections are particularly important to alleviate providers' fears that they may be subject to retaliation or loss of licensure for providing gender-affirming care. Another commenter similarly argued that covered entities sometimes discriminate against transgender patients by prohibiting their providers from providing certain services.

Response: As noted in the Proposed Rule, 87 FR 47866, this provision recognizes that prohibited discrimination may take the form of restrictions on individual providers, such as attending physicians, that have the effect of discriminating against patients. Where a covered entity imposes such a restriction based on a patient's gender identity or sex assigned at birth, the restriction may constitute prohibited discrimination in violation of this rule, even if the form that the restriction takes is a limitation on the ability of providers to prescribe or provide care.

Regarding providers' fears that they may be subject to retaliation by their employer or loss of licensure, this rule does not apply to employment practices, as discussed in § 92.2(b), but employees of covered entities remain protected against retaliation as provided in §§ 92.303 and 92.304. Not all State licensure boards receive Federal financial assistance from the Department; upon receipt of a complaint against a licensure board, OCR would need to first determine whether we have jurisdiction before commencing an investigation.

Also, we note that a health care provider's decision not to provide any service due to a sincerely held religious belief or conscience objection is discussed further in §§ 92.208 and 92.302.

Comment: Many commenters suggested that § 92.206(b)(2) would be clearer if the following phrase was deleted because it is redundant: “if such denial or limitation has the effect of excluding individuals from participation in, denying them the benefits of, or otherwise subjecting them to discrimination on the basis of sex under a covered health program or activity.”

Response: OCR appreciates the suggestion and has considered it, but we Start Printed Page 37593 will maintain the proposed language, as the phrase provides additional explanation of what would constitute discrimination. As we noted in the Proposed Rule, 87 FR 47866, this is modeled on the provision in the title VI regulations that notes that certain discriminatory employment practices may be prohibited to the extent that they result in discrimination against program participants, even though the primary objective of title VI is not to regulate employment practices. See45 CFR 80.3(c)(3). Likewise, the phrase commenters propose deleting here clarifies that these restrictions on providers are prohibited only insofar as they result in discrimination against individuals on the basis of sex in a covered health program or activity. This phrase is necessary to establish a violation because a discriminatory act under this rule is one in which the individual is excluded from, denied the benefits of, or otherwise subjected to discrimination under a health program or activity on the basis of sex.

Comment: A few commenters stated that it appears that § 92.206(b)(2) is directly aimed at the United States Conference of Catholic Bishops' Ethical and Religious Directives for Catholic Health Care Services.^[158] These commenters recommended that OCR disavow this provision and affirm support for the value of religiously affiliated health care and the right of faith-based hospitals to operate in accordance with their convictions.

Response: As stated throughout this preamble, OCR values the vital role that faith-based hospitals and other health care providers and systems play in our nation's health care system. With respect to concerns about potential conflicts between provisions of the final rule and individuals' or organizations' sincerely held religious beliefs, we refer commenters to the discussion at § 92.302. The aim of § 92.206(b)(2) is to address discrimination that has a secondary effect on the ability of individuals to participate meaningfully in and/or to receive health care from a covered health program in a nondiscriminatory manner. OCR did not, nor did it intend to, single out any religious teachings and will respect all guarantees of Federal religious freedom and conscience laws.

Comment: Commenters highlighted that transgender and nonbinary people face unique discrimination in inpatient settings that are separated by sex, particularly those that have only male and female facilities available. These commenters noted that this results in nonbinary people not having access to facilities consistent with their gender identity.

A few commenters raised concerns about the application of § 92.206(b)(3) to arrangements and practices involving patients who share intimate space with, or require intimate personal assistance from, other individuals. The commenters argued that the requirement to treat individuals consistent with their gender identity may raise concerns for privacy.

Response: OCR appreciates the commenters' feedback. As specified in the preamble discussion for § 92.101, this final rule protects all people regardless of gender identity, including transgender and nonbinary people. Nothing in this rule prohibits a covered entity from operating sex separated programs and facilities, so long as it does not subject anyone, including transgender and nonbinary individuals, to more than de minimis harm on the basis of sex. When a nonbinary individual seeks participation in a single-sex health program or activity or a health program or activity that maintains sex separate facilities, the covered entity should work with that individual to determine where they will best be served and where they can benefit the most from the health program or activity without experiencing trauma, distress, or threats to their safety due to an incorrect placement. A covered entity must not deny a nonbinary individual access to a health program or facility on the basis that the program or facility separates patients based on sex or offers separate male and female programs or facilities.

Courts have held that all individuals' safety and privacy can be protected without also excluding transgender individuals from accessing sex-separate facilities and activities consistent with their gender identity.^[159] Nothing in the rule prevents covered entities from implementing policies or procedures to preserve any patient's privacy—consistent with the requirements of this rule and any other applicable laws. Providers have a range of tools at their disposal to accommodate individuals' privacy concerns and patient interests in a nondiscriminatory manner. For example, a provider generally may accommodate a patient's preferences about roommate assignments. A covered entity will be in violation of this rule if they refuse to admit a transgender person for care or refuse to place them in facilities consistent with their gender identity, because doing so would result in more than de minimis harm. We also note that no application of this rule shall be required insofar as it would violate Federal religious freedom and conscience laws. Recipients may rely on those protections directly, see § 92.3(c), or they may seek an assurance of a religious freedom or conscience exemption, see § 92.302(b).

Comment: A commenter opposed the rule on the grounds that it would violate the U.S. Constitution's Equal Protection Clause standard for sex discrimination claims, which the commenter asserted allows men and women to be treated differently based on inherent differences in biology when such differences are real and not based on stereotypes. The commenter argued that proposed § 92.206(b)(3) would inappropriately prohibit providers from using any sex-based distinction unless they can prove it does not cause more than de minimis harm. This commenter alleged that the true purpose of such a provision is not equal treatment for all patients but special treatment for transgender individuals, particularly with respect to the use of sex-separate facilities. This commenter also argued that the provision would contradict the Voluntary Resolution Agreement the Department entered into with Michigan State University (MSU) under section 1557, which requires the presence of a chaperone—the sex of whom should be determined by the wishes and comfort of the patient—for all sensitive examinations.^[160]

Response: Not all differential treatment on the basis of sex constitutes unlawful discrimination under section 1557, and the final rule does not prohibit all differential treatment.^[161] If a Start Printed Page 37594 sex-based distinction has only a de minimis impact, it is not prohibited discrimination.^[162] But treating individuals differently on the basis of sex constitutes sex discrimination where it imposes a more-than- de minimis level of harm. Under the rule, providers may use sex-based distinctions to administer individualized care, provided those distinctions do not cause more than de minimis harm.

We disagree with the proposition that purpose of § 92.206(b)(3) is special treatment for transgender individuals, particularly with respect to the use of sex-specific facilities. The purpose of this section is to prevent unlawful discrimination on the basis of sex. The prevention of discrimination on the basis of gender identity is an important government objective that is substantially achieved by this rule.

Further, the Voluntary Resolution Agreement entered into with MSU, provides that a patient may request a chaperone to be present at any time and that the patient's “wishes and comfort should determine the sex of the chaperone.” ^[163] It further specifies that MSU “shall accommodate, to the extent practicable, the Patient's request for a same-sex chaperone.” ^[164] The final rule does not prohibit patients from requesting or receiving a chaperone of the sex of their choosing.

Finally, OCR disagrees with the commenter that the rule violates the Equal Protection Clause. OCR's authority to promulgate this rule stems from a Federal non-discrimination statute, section 1557. This rule does not purport to interpret the Equal Protection Clause. Thus, even assuming the commenter is correct that the rule bans certain sex-based distinctions that would be permitted under the Equal Protection Clause, such a discrepancy would not mean the rule is unlawful. OCR may promulgate a rule that imposes different non-discrimination requirements on recipients of Federal funds than the non-discrimination requirements the Equal Protection Clause imposes on the government.^[165]

Comment: A health research organization expressed support regarding § 92.206(b)(3)'s discussion of the impact on health research and clinical trials. The commenter commended OCR on its guidance on sex-specific health research. This commenter stated that the standard for limiting research outlined by OCR in the 2022 NPRM was reasonable and health researchers will typically be able to demonstrate the requisite justification for a sex-specific research project or clinical trial based on research protocols. However, the commenter requested OCR provide similar guidance for the final rule on whether health research protocols that target or exclude individuals with disabilities would be considered discriminatory.

Conversely, another organizational commenter disagreed with the statement on sex-specific clinical trials because the commenter believed it would pressure clinical researchers and organizations to disregard sex-based distinctions for fear of inviting a gender identity discrimination claim. The commenter claimed that the rule would contradict National Institutes of Health (NIH)'s expectation for clinical trials, which the commenter claimed required specifying the “biological sex” of subjects, by laying down an “unscientific marker” that sex-specific clinical trials can only be justified in limited circumstances.^[166] The commenter further argued that this would represent a backward step for women's health, because the evaluation of diseases and treatments improved when researchers recognized that sex must be taken into account as a biological variable in medicine.

Response: OCR appreciates these comments regarding the application of this provision to sex-specific health research and clinical trials and the standard proposed for evaluating claims of discrimination in such health programs and activities. We agree that researchers should not have challenges showing necessary justifications for nondiscriminatory research distinctions grounded in a participant's reproductive, anatomical, and genetic characteristics.

We disagree with the proposition that OCR is disregarding sex-based distinctions in medicine. Health research and clinical trial protocols are not prohibited from specifying an individual's sex consistent with their reproductive, anatomical, and genetic characteristics, where those characteristics are relevant to the clinical trial. However, there are ways in which health research and protocols may result in discrimination, such as disallowing participation based on gender identity rather than on the basis of scientific requirement of the research.

Should the need arise, OCR will consider issuing guidance on the impacts of disability protections on research participation.

Comment: Several commenters supported the rule's prohibition on sex-specific health programs or activities that subject any individual to more than de minimis harm. One supportive commenter argued that this approach recognizes harm as the primary measure of discrimination and creates flexibility to identify new forms of harm, and another argued the standard of no more than de minimis harm is consistent with applicable case law, including Bostock. A commenter expressed appreciation for the Proposed Rule's detailed explanation of de minimis harm and the difference between clinical care for a patient.

Conversely, another commenter stated the Proposed Rule “cherry picks” a title IX court decision to justify a standard of “more than de minimis harm” as the basis for “adjudicating gender identity,” arguing that title IX has never required sex to be recognized as anything but “objectively, biologically based.” Similarly, another commenter argued the rule applies beyond denial or limitations on health services. The commenter argued that the rule would prohibit health care professionals, medical facilities, and insurance companies from using any sex-based distinction unless they can prove it does not cause more than de minimis harm, and that if a provider asks the wrong question or asks an appropriate question in the wrong manner then the provider will likely face a claim of discrimination on the basis of gender identity.

Response: OCR appreciates the range of comments provided on the proposed language regarding de minimis harm, and after careful review, OCR is finalizing the language as proposed. The rule does not prohibit all sex-based distinctions in health programs or activities, nor does it broadly prohibit any policy or practice of treating Start Printed Page 37595 individuals differently based on sex. As noted in the Proposed Rule, although intentional differential treatment on the basis of sex would generally be considered prohibited discrimination, separation by sex or differential treatment on the basis of sex is permissible under section 1557 where it does not cause more than de minimis harm. 87 FR 47866. This distinction generally allows for sex-specific clinical trials when sex is relevant to the trial, for example, while still prohibiting differential treatment that causes harm.

Providers often need to make inquiries about a patient's sex-related medical history, health status, or physical traits related to sex in the course of providing care and this rule does not prohibit or inhibit that. 87 FR 47867-68. Such inquiries are not per se discriminatory, even where they touch on intimate or sensitive matters. For example, it is not discriminatory for a provider treating a patient presenting with symptoms consistent with an ectopic pregnancy to inquire about the possibility that the patient could be pregnant, regardless of that patient's gender identity. Similarly, when providing appropriate care to a patient, asking medically relevant questions about a patient's anatomy or medical history in a way that causes inadvertent distress—on its own—would not violate section 1557. However, it is important to note that if such questions are not relevant to assessing the patient's condition, or the patient has answered the questions and makes clear that further questions are unwelcome, the inquiries may rise to the level of harassment on the basis of sex. For example, if the conduct is so severe or pervasive that it denies a patient access to medical care, it would no longer be permissible. OCR will evaluate these types of harassment claims on a case-by-case basis to determine whether the alleged harassment was “sufficiently severe, pervasive, and objectively offensive,” to meet the standards for discriminatory harassment.^[167]

In response to commenters that questioned the legal basis for our de minimis standard, we discussed in the 2022 NPRM, 87 FR 47866, n. 412, that sex-based distinctions that have only de minimis impact are not the type of discrimination that Congress envisioned.^[168]

Comment: A commenter recommended that, based on existing racial disparities in maternal health and overall poor maternal health outcomes in the United States, § 92.206(b)(3) be amended to specify that harm exceeding the threshold of de minimis harm with respect to pregnancy and maternal health can include policies or practices that subject people to rough handling, harsh language, undertreatment of pain or pregnancy-related conditions, or other discriminatory mistreatment during childbirth or the prenatal or postpartum periods.

Response: OCR recognizes that there is ample research demonstrating the significant racial disparities in maternal health outcomes.^[169] Section 92.206(b)(3) specifically addresses different treatment on the basis of sex, such as through sex-separate health programs and activities. Depending on the specific facts at issue, the treatment described by the commenter may rise to the level of discrimination and would be evaluated under this rule's general prohibition of discrimination under § 92.101.

Comment: An organizational commenter strongly supported the additional guidance provided by proposed §§ 92.206 and 92.207 and noted that the forms of discrimination highlighted in proposed §§ 92.206(b)(3) and (4) and 92.207(b)(3) through (5), in particular, affect many intersex people.

Response: OCR appreciates the commenter's feedback regarding the discrimination addressed in §§ 92.206(b)(3) and (4) and 92.207(b)(3) through (5) affecting intersex people as well. This final rule makes explicit in regulatory text that sex discrimination includes discrimination based on sex characteristics, including intersex traits, as reflected in § 92.101(a)(2).

Comment: Many commenters expressed support for the proposed provisions related to gender-affirming care at § 92.206(b)(4). These commenters stated that such care can be critical to the well-being of transgender and nonbinary people, and that accessing such care can reduce the risk of negative physical and mental health outcomes associated with gender dysphoria. Commenters discussed the negative impact of widespread health care discrimination against transgender people, stating that transgender people of color and transgender people with disabilities are at particularly high risk of discrimination and associated harms.

Response: OCR appreciates these comments and agrees that the nondiscrimination protections are important to transgender and nonbinary people's ability to access clinically appropriate care, especially those who may face elevated risk of harm due to discrimination on multiple protected bases.

In determining whether a covered entity violated section 1557 by denying or limiting a health service sought for the purpose of gender-affirming care, OCR will continue to consider evidence that the covered entity would provide that same service for other purposes. Evidence that OCR may consider to establish that the type of care is ordinarily provided could include, among other things, statements by the provider, information showing that the provider has provided similar care in the past, or documentation regarding the provider's scope of practice.

Where there is other evidence that the covered entity has subjected the individual to differential treatment on the basis of sex apart from the denial of care itself, OCR may investigate and make a case-by-case determination as to whether prohibited discrimination has occurred.

Comment: A few commenters stated that OCR is explicitly asserting that it has authority under section 1557 to regulate the practice of medicine according to its own determination of what is appropriate and non-discriminatory care, along with authority to definitively determine what is the current standard of medical care. Some commenters requested OCR amend the provision to specify that care standards cannot facially discriminate or otherwise result in discrimination based on a protected characteristic, such that covered entities cannot mask discrimination behind clinical policies or criteria.

Response: Section 1557 prohibits discrimination on certain prohibited bases, and does not (and cannot) require a specific standard of care or course of treatment for any individual or otherwise interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician's judgment about whether a particular service is medically appropriate for an individual, or Start Printed Page 37596 whether the clinician has the appropriate expertise to provide care. There is no part of section 1557 that compels clinicians to provide a service that they do not believe is medically appropriate for a patient or that they are not qualified to provide.

Section 92.206(c) is consistent with the general principle in nondiscrimination law that entities facing allegations of discrimination have the opportunity to articulate a legitimate, nondiscriminatory basis for their challenged action or practice but that such a basis may not be a pretext for discrimination.

Comment: Some commenters expressed concern that OCR is setting standards of care for gender-affirming care in this rule, and that is outside the scope of OCR's authority. Many commenters weighed in with their views on the state of medical evidence relating to gender-affirming care and submitted citations to research studies and other data. Some comments characterized the evidence as lacking or mixed, and highlighted their concerns relating to gender-affirming care for minors. Others stated that there is robust evidence, including from major medical associations, supporting the provision of gender-affirming care, including that such medically necessary care benefits the health and well-being of transgender patients.

Response: This final rule prohibits discrimination on the basis of sex, consistent with Federal law. As such, nothing in this rule impedes covered entities from taking nondiscriminatory actions based on current medical standards and evidence, such as making decisions about the timing or type of protocols appropriate for care. The rule does not (and cannot) require a specific standard of care or course of treatment for any individual, minor or adult. Section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician's judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care.

Comment: A number of commenters had concerns or questions about the scope of how OCR would define gender-affirming care. Some commenters requested a definition or an enumeration of what types of procedures would fall within this term. Others raised concerns about the impact of such care and the benefits of such care.

Response: As with the 2016 Rule, 81 FR 31435, OCR declines to provide a regulatory definition for gender-affirming care. However, when we used the term “gender-affirming care” in both §§ 92.206 and 92.207, we are generally referring to care designed to treat gender dysphoria that may include, but is not necessarily limited to, counseling, hormone therapy, surgery, and other related services. 87 FR 47834 n.139. As noted elsewhere, the rule does not impose a categorical requirement that covered entities must provide gender-affirming care. Further, while we acknowledge comments in support of and opposed to gender affirming care and its subsequent impacts on individuals, we are not making any additional edits to the rule in response.

Comment: Some commenters opposing the rule raised First Amendment concerns and questioned the scope of what would be required of providers in terms of expressing support of transgender people who wish to access gender-affirming care, using the name and pronouns requested by patients, and speaking about gender-affirming care.

Response: OCR takes seriously concerns about, and is fully committed to upholding, the First Amendment, and nothing in these regulations restricts conduct protected by the First Amendment.^[170] Whether discrimination is unlawful or considered harassment is necessarily fact-specific. This final rule does not purport to identify all of the circumstances that could constitute unlawful harassment. It is unlikely that an isolated incident with no other indications of animus or ill treatment would meet the standards for discriminatory harassment. Conversely, OCR notes that conduct, including verbal harassment, that is so severe or pervasive that it creates a hostile environment on the basis of sex is a form of sex discrimination.

Comment: A few commenters argued that providing gender-affirming care poses high malpractice lawsuit risks to providers, and therefore OCR should not categorically require providers to provide such services.

Response: As discussed elsewhere in this preamble, this final rule prohibits discrimination in the provision of health programs and activities and does not require provision of any specific services, including gender-affirming care. Section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician's judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care.

Comment: One commenter expressed concern that the rule would result in decreased access to health care, as providers may choose to leave Federal health care programs based on a belief that they will be required to provide gender-affirming care, especially if there is no avenue for providers with religious or conscience objections to certain types of care to request exemptions.

Response: Section 1557 requires that health care providers who receive Federal financial assistance must provide nondiscriminatory care. However, providers do not have an affirmative obligation to offer any health care, including gender-affirming care, that they do not think is clinically appropriate or if religious freedom and conscience protections apply. OCR believes that the majority of providers already provide nondiscriminatory care to their patients and will continue to do so. This commenter presented no evidence that a significant exodus of providers is likely, and we are not aware of any data to support a significant concern on this front. Providers with religious freedom or conscience concerns, however, may rely upon §§ 92.3 and 92.302.

Comment: A few commenters expressed support for nondiscrimination protections that prohibited discriminating against an individual because of their gender identity but opposed interpreting such protections to protect access to gender-affirming care.

Response: OCR appreciates these commenters' support for the rule's nondiscrimination protections on the basis of gender identity. We respectfully disagree, however, that such protections have no implications for the provision of gender-affirming care. A fact-specific analysis is necessary to determine whether prohibited discrimination has occurred, but the rejection of a practice closely linked with a protected status may, in conjunction with other evidence, lead to a finding of discrimination. This rule does not require or mandate the provision of any particular medical service. Section 1557 prohibits discrimination on certain prohibited bases, and does not interfere Start Printed Page 37597 with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician's judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care.

Comment: An organizational commenter supported reference to the multi-factor test found in Arlington Heights v. Metro. Housing Dev. Corp., 429 U.S. 252 (1977), and the burden-shifting framework of McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), among a non-exhaustive list of tools that OCR may utilize for investigating discrimination claims. The commenter asserted that sex discrimination claims are hard to prove, and that together these approaches are appropriate for their adjudication by allowing people to rely on different types of circumstantial evidence to collectively demonstrate a discriminatory act by a covered entity and by placing the onus on the covered entity to provide a legitimate, nondiscriminatory reason for its actions. Similarly, another commenter encouraged OCR to clearly state in the final rule that the familiar but-for causation test applies to establishing a violation of section 1557; that the use of the phrase “legitimate, nondiscriminatory reason” in these sections should not be construed in any way to limit the method of proof for any section 1557 claim to the McDonnell Douglas burden-shifting framework; and that this method cannot be used to defend an express sex-based classification that causes injury. Another commenter recommended that OCR clarify in the preamble to the final rule that the McDonnell Douglas burden-shifting framework and legitimate non-discriminatory reason framework apply to circumstantial evidence cases but not where there is direct evidence of discrimination.

Response: OCR agrees that different methods of proof drawn from civil rights case law should be used in analyzing claims of discrimination under this section including, but not limited to, the Arlington Heights multi-factor test and the McDonnell Douglas burden-shifting framework. For cases where the alleged discrimination is not based on a facially discriminatory policy, we are clarifying that the phrase “legitimate, nondiscriminatory reason” in these sections is taken from, but should not be construed to limit, the method of proof to the McDonnell Douglas burden-shifting framework. As we noted in the Proposed Rule, Arlington Heights provides a method of proof that uses a number of different types of evidence— e.g., direct, circumstantial, statistical, and anecdotal—that, taken collectively, can demonstrate that the covered entity acted because of a protected basis; the McDonnell Douglas burden-shifting framework is an inferential method of proof most commonly applied in cases alleging discrimination in individual instances where a plaintiff alleges that a defendant treated similarly situated individuals differently because of a protected basis. 87 FR 47865. Under the Arlington Heights framework, McDonnell Douglas evidence identifying similarly situated comparators can also be considered but is not required.^[171]

Comment: Many commenters supported the rule's clarification that while providers may exercise clinical judgment when determining if a particular service is appropriate for an individual patient, they may not refuse gender-affirming care based on a belief that such care is never clinically appropriate. A great number of individuals and organizations provided comment on the types of rationales that might constitute a legitimate, nondiscriminatory basis for a provider declining to provide gender-affirming care. Some commenters opined that it should not be considered discriminatory to deny care when a provider categorically objects to gender-affirming care. Other commenters appreciated the clarification that a provider's personal belief that gender-affirming care is never appropriate is not a legitimate, nondiscriminatory basis for denying such care. The majority of commenters opined that the rule provides adequate protection for providers exercising nondiscriminatory clinical judgment about the appropriateness of particular care for a specific patient, though some commenters disagreed.

Response: OCR appreciates commenters' views on proposed § 92.206(c). In light of comments received, we are modifying the language in this provision to provide additional specificity regarding how OCR will evaluate a covered entity's proffered legitimate, nondiscriminatory reason for denying care. We also add a reference to § 92.302 to make clear that this provision does not limit a recipient's ability to seek assurance of an exemption based on religious freedom or conscience laws. Also, we note that while many commenters specifically discuss providers' personal beliefs, these changes clarify that the rule applies to covered entities rather than specific individuals.

To provide additional specificity, we are striking the second sentence of § 92.206(c), which previously read, “[h]owever, a provider's belief that gender transition or other gender-affirming care can never be beneficial for such individuals (or its compliance with a State or local law that reflects a similar judgment) is not a sufficient basis for a judgment that a health service is not clinically appropriate,” in its entirety and replacing it with: “A covered entity's determination must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302.” Our reasons for this change are as follows:

First, many commenters strongly urged OCR to consider that providers may have a nondiscriminatory reason to not provide some aspects of or all gender-affirming care. OCR understands that a provider may have a legitimate nondiscriminatory reason not to provide a health service, which the newly revised § 92.206(c) makes clear. While this section has application in the gender-affirming care context, the revised language is also intended to make clear that it is not limited to that context. When OCR investigates claims of discrimination based on the denial of care, OCR will consider the covered entity's rationale for such denial, any supporting information the covered entity offers for its position, and any evidence of unlawful animus, bias, or other discriminatory factors in the case.

Second, and as discussed, section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician's judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. There is no part of section 1557 that compels clinicians to provide a service that they do not believe is medically appropriate for a particular patient or that they are not qualified to provide.

Since the rule does not (and cannot) set a standard of care for gender-affirming care, the focus of any investigation will not be to generally Start Printed Page 37598 review a covered entity's clinical judgment but rather to determine whether the assertion of that judgment reflects unlawful animus or bias, or is a pretext for discrimination. Similarly, outside of the gender-affirming care context, OCR may find an invocation of clinical appropriateness to be pretextual if, for example, the evidence demonstrates that the covered entity asserted that pain medication was not clinically appropriate for a patient because of the belief that women exaggerate pain symptoms and inaccurately relay information about their symptoms.

Third, because many commenters expressed concern about the relationship between § 92.206(c) and religious or moral beliefs concerning gender-affirming care, we added an explicit reference in § 92.206(c) to § 92.302. The new language clarifies that § 92.206(c) does not preclude the process set forth in § 92.302 where a recipient's objection to gender-affirming care may be protected under religious freedom and conscience laws.

Comment: Many commenters also cited religious or moral objections to gender-affirming care, urging that these should be considered a legitimate, nondiscriminatory reason to decline to provide such care.

Response: OCR understands that recipients may have religious or conscience objections to the provision of certain types of care. Such an objection can serve as a legitimate, nondiscriminatory reason where it is neither pretextual nor discriminatory. If a provider typically declines to provide a particular health service to any individual based on a religious belief, regardless of individual's sex assigned at birth or gender identity, the provider likely meets § 92.206(c)'s standard for a “legitimate, nondiscriminatory reason.” And where a provider's religious belief causes the provider to treat individuals differently based on sex assigned at birth or gender identity, the provider may rely on the protections afforded by religious freedom and conscience laws or choose to seek assurance of those protections by making use of § 92.302(b)'s assurance of religious freedom and conscience exemption process, a feature that both the 2016 and 2020 Rules lacked. As discussed in more detail below, OCR is making several modifications to § 92.302 to strengthen and clarify this process.

Comment: Many commenters supported the inclusion of § 92.206(c) but recommended that OCR strengthen the language pertaining to providers complying with a State or local law as a justification for denying gender-affirming care, abortions, or other reproductive health care to clarify that as a Federal civil rights law, the rule preempts any such State or local law restricting access to such care. Some commenters suggested including language in the preamble to make clear that the majority of States' policies that restrict transgender and nonbinary people's access to health care would be barred. Another commenter expressed support for explicit preemption language, because otherwise providers would be forced to attempt to comply with State and local laws, while also trying not to run afoul of OCR's case-by-case judgment concerning what conduct may be considered discriminatory. Some commenters expressed concern that the rule could deem physicians' conduct discriminatory when declining to provide services because of State or local laws restricting those services, leaving them in an untenable position. Other commenters criticized the rule because they believe it preempts State laws restricting abortion and gender-affirming care and seeks to preempt State laws on religious freedom and conscience. A commenter expressed confusion as to how the rule would preempt State law as opposed to simply disallowing Federal funds from entities that do not comply.

Response: OCR understands providers' concerns that the provision's reference regarding compliance with State or local law would place them in a difficult position with regard to the conflicting demands of this rule's nondiscrimination requirements and various State and local laws restricting access to abortion or gender-affirming care. While we have removed the language from § 92.206(c) that many commenters supported, section 1557's nondiscrimination requirements nevertheless generally preempt conflicting State law for the reasons stated earlier in this preamble. That said, in exercising and determining its enforcement priorities, OCR will consider the specific factual record of each complaint on a case-by-case basis. This may include, among other things, consideration of whether any covered entity that is taking discriminatory actions under the rule is doing so because it believes in good faith it is obligated to do so by State or local law, whether that covered entity demonstrated a willingness to refer or provide accurate information about gender-affirming care, or is otherwise engaging in good faith efforts to ensure patients are receiving medically necessary care.

Comment: Several commenters expressed support for § 92.206(d)'s clarification that the enumeration of specific forms of prohibited discrimination in § 92.206(b) does not limit the general prohibition against discrimination in § 92.206(a), while recommending that additional preamble language be added to the final rule citing additional examples of discrimination and to provide confirmation that OCR's investigations will not be limited by the enumerated examples in § 92.206(b).

Response: We emphasize that § 92.206(b) is not an exhaustive list of all scenarios that would constitute of sex discrimination under the rule. We have provided additional examples of sex discrimination in this preamble, and OCR's investigations will not be limited by the enumerated forms of discrimination addressed in § 92.206(b) or elsewhere.

Comment: One commenter stated that OCR ignored Burwell v. Hobby Lobby, 573 U.S. 682 (2014), in the Proposed Rule and that the Proposed Rule is comparable to the Department's actions in that case, in which the Court found that the government's compelling interest in protecting women's health could be accomplished in a less restrictive manner.

Response: OCR has considered Hobby Lobby and will be mindful of it when carrying out enforcement of the final rule. For a further discussion of views regarding application of Federal conscience or religious freedom laws, refer to § 92.302.

Summary of Regulatory Changes

For the reasons set forth above and considering the comments received, we are finalizing the provision as proposed in § 92.206, with modifications. We have revised § 92.206(b)(1) to state: “Deny or limit health services, including those that have been typically or exclusively provided to, or associated with, individuals of one sex . . . .” We are revising § 92.206(c) to remove the sentence that reads: “However, a provider's belief that gender transition or other gender-affirming care can never be beneficial for such individuals (or its compliance with a state or local law that reflects a similar judgment) is not a sufficient basis for a judgment that a health service is not clinically appropriate.” To the end of § 92.206(c) we are adding sentences that read: “A covered entity's determination must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302.” Start Printed Page 37599

Nondiscrimination in Health Insurance Coverage and Other Health-Related Coverage (§ 92.207)

In § 92.207, OCR proposed to prohibit discrimination on the basis of race, color, national origin, sex, age, or disability in the provision or administration of health insurance coverage and other health-related coverage. This proposed section would apply to all covered entities that provide or administer health insurance coverage or other health-related coverage that receive Federal financial assistance, and the Department in the administration of its health-related coverage programs.

In § 92.207(a), OCR proposed a general nondiscrimination requirement, and § 92.207(b) proposed specific examples of prohibited actions.

In § 92.207(b)(1), OCR specified that covered entities are prohibited from denying, cancelling, limiting, or refusing to issue or renew health insurance coverage or other health-related coverage, or denying or limiting coverage of a claim, or imposing additional cost sharing or other limitations or restrictions on coverage, on the basis of race, color, national origin, sex, age, or disability.

In § 92.207(b)(2), OCR proposed prohibiting marketing practices or benefit designs that discriminate on the basis of race, color, national origin, sex, age, or disability.

In § 92.207(b)(3), OCR proposed that it is prohibited discrimination to deny or limit coverage, deny or limit coverage of a claim, or impose additional cost sharing or other limitations or restrictions on coverage to an individual based upon the individual's sex at birth, gender identity, or gender otherwise recorded. We invited comment on this provision, including whether it sufficiently addresses the challenges transgender and gender nonconforming individuals are experiencing when seeking access to medically necessary care due to a discordance between their sex assigned at birth and their sex as recorded by their issuer.

In § 92.207(b)(4), OCR proposed to prohibit a covered entity from having or implementing a categorical coverage exclusion or limitation for all health services related to gender transition or other gender-affirming care.^[172]

In § 92.207(b)(5), OCR proposed to ensure that a covered entity does not impose discriminatory limits on coverage for specific health services related to gender transition or other gender-affirming care, which would generally be the case if such limits are not applied when those same health services are not related to gender transition or other gender-affirming care.

In § 92.207(b)(6), OCR proposed an integration provision that prohibits covered entities from having or implementing a benefit design that does not provide or administer health insurance coverage or other health-related coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities.

OCR sought comment on the scope and nature of the benefit design features that result in unjustified segregation or institutionalization of qualified individuals with disabilities or place such individuals at serious risk of institutionalization or segregation. We were interested in feedback on the application of the integration requirement to a wide variety of health services and were particularly interested in comments on the application of the integration requirement to coverage of post-acute services, mental health services, and other services commonly provided by non-State payers ( i.e., health insurance issuers, self-insured group health plans, and other payers). OCR was also interested in feedback on the application of the integration requirement to the Medicaid program and its statutory framework at title XIX of the Social Security Act. Specifically, we requested input on how State Medicaid agencies are able to achieve compliance with the integration requirement through benefit design, such as through reimbursement, service scope, and service authorization that do not incentivize institutional services over community services. In addition, OCR requested input on the amount of time needed to reach compliance with needed benefit design modifications.

In § 92.207(c), OCR stated that nothing in this section requires the coverage of any health service where the covered entity has a legitimate, nondiscriminatory reason for determining that such health service fails to meet applicable coverage requirements, such as medical necessity requirements, in an individual case.

Finally, in § 92.207(d), OCR made clear that the enumeration of specific forms of discrimination in § 92.207(b) does not limit the general applicability of the prohibition in § 92.207(a).

OCR generally invited comment on how section 1557 might apply to: provider networks; how provider networks are developed, including factors that are considered in the creation of the network and steps taken to ensure that an adequate number of providers and facilities that treat a variety of health conditions are included in the network; the ways in which provider networks limit or deny access to care for individuals on the basis of race, color, national origin, sex, age, or disability; and the extent to which the lack of availability of accessible medical diagnostic equipment in a provider network limits or denies access to care for individuals with disabilities. We also sought comment on the extent, scope and nature of value assessment methods that discriminate on the basis of race, color, national origin, sex, age, or disability. We were interested in feedback on the civil rights implications of value assessment across a wide variety of contexts, including utilization management, formulary design, price negotiations, alternative payment models and other relevant applications. Finally, OCR invited comment on all aspects of this section. In particular, we sought comment on the anticipated impact of the proposed application to excepted benefits and short-term, limited duration insurance (STLDI) when such products are offered by a covered entity; how the Proposed Rule's nondiscrimination requirements would impact the industry that offers excepted benefits and STLDI and the consumers who rely upon those products; the prevalence of excepted benefits and STLDI offered by covered entities and the standard industry practices under which such plans are designed and administered; and excepted benefits and STLDI plans' scope of coverage, types of exclusions and limitations, underwriting practices, premium setting, and actuarial or business justifications for industry practices (as applicable), that may raise concerns about discrimination under section 1557.

The comments and our responses regarding § 92.207 are set forth below.

For ease of reference, OCR may simply refer to “health insurance issuers” or “issuers” throughout the preamble, but other covered entities may also be subject to the section under Start Printed Page 37600 discussion. In addition, for purposes of this preamble only, OCR uses the term “health plan” or “plan” interchangeably to refer generally to health insurance coverage and other health-related coverage that is subject to this rule. As used in this preamble, “health plan” or “plan” may include health insurance coverage or other health-related coverage offered in the group and individual markets, group health plan coverage, Medicare Advantage plans, Medicare Part D plans, and Medicaid programs that are subject to this rule. OCR does not intend “health plan” or “plan” to be regulatory terms in this regulation or to replace any existing or proposed term in Federal law.

OCR notes that a variety of entities may be considered covered entities subject to § 92.207, including but not limited to health insurance issuers, group health plans, Medicare Advantage Organizations, Medicare Part D plan sponsors, Medicaid managed care plans, pharmacy benefit managers, third party administrators (as part of a covered entity's operations when it meets the criteria in paragraph (2) of the definition of “health program or activity” under § 92.4), and the Department.

Comment: Commenters strongly supported the inclusion of an explicit provision related to prohibited discrimination in health insurance coverage and other health-related coverage, noting that it will help provide clarity for covered entities. Many commenters stated that it is clear from the statutory text of the ACA that Congress intended for section 1557 to apply to health insurance. Commenters stated that the 2020 Rule's rescission of similar protections created confusion, was contrary to the intent and purpose of the ACA, and increased the burden on States to monitor and enforce nondiscrimination laws. Commenters noted that ensuring covered entities provide health insurance coverage and other health-related coverage in a nondiscriminatory manner will reduce adverse health outcomes and address some of the barriers vulnerable communities face in accessing health insurance coverage and other health-related coverage. Commenters from the health insurance industry were generally supportive of reinstating the section with some suggested modifications. This includes one commenter noting that, as an employer, they appreciated the Proposed Rule's clarification prohibiting categorical exclusions, noting that the 2016 Rule's similar prohibition had allowed them to negotiate a nondiscriminatory plan to cover their employees.

One organizational commenter opposed to the inclusion of § 92.207 argued that health insurance issuers could face substantial costs, including compliance costs and claims costs, as a result of having to alter their coverages and business practices, which would result in higher premiums. This commenter also argued OCR is engaging in expansive and detailed regulation of numerous issuer business decisions in an arbitrary and capricious manner that could result in issuers facing heightened business risks and increased liability exposure.

Response: OCR agrees that section 1557 applies broadly, including to prohibit discrimination by covered entities that provide or administer health insurance coverage and other health-related coverage. As discussed throughout this preamble, particularly under the discussion of the definition of “health program or activity” under § 92.4, the ACA is clearly intended to apply to health insurance coverage and other health-related coverage and prohibit the discriminatory practices therein.

OCR disagrees that § 92.207 imposes expansive regulation of health insurance issuers and their business decisions in an arbitrary and capricious manner. The plain text of section 1557 applies to health insurance coverage and other health-related coverage; OCR is implementing Congressional intent to prohibit discrimination in health insurance coverage and other health-related coverage in § 92.207. In addition to section 1557, health insurance issuers are required to comply with myriad State and Federal laws regulating the practice of health insurance coverage and other health-related coverage. These laws include other Federal laws that regulate health insurance coverage and other health-related coverage practices, including nondiscrimination requirements.^[173] Compliance with legal requirements, such as section 1557, is a standard business practice as a health insurance issuer. Further, health insurance issuers were subject to former § 92.207's requirements ^[174] from either July 18, 2016, or January 1, 2017 (if plan design changes were required as a result of the 2016 Rule), through August 18, 2020, the effective date of the 2020 Rule.

Comment: Some commenters supported § 92.207(b)(1), related to coverage denials and limitations. Some commenters asked OCR to state that cost sharing must not be used by covered entities in a discriminatory manner. Commenters acknowledged that cost sharing can be an effective tool, but they also expressed concern that insurance companies and pharmacy benefit managers are increasingly employing high cost sharing that disproportionately affects people with disabilities, chronic conditions, and other significant health needs. Commenters cited several studies that show patients who are uncertain about their ability to afford their out-of-pocket care expenses delay or forgo care or fall out of compliance with recommended follow-up steps.^[175] Commenters noted that such gaps in care can have deadly consequences for individuals with certain conditions, such as people living with HIV/AIDS.

Commenters also provided examples of concerns related to cost sharing and patient financial assistance. A few commenters raised concerns about treatment of patient financial assistance, accumulator adjustment programs, copay maximizers, and alternative funding programs. Other commenters raised concerns about issuers designating drugs as “non-essential-health-benefits” to avoid certain Start Printed Page 37601 essential health benefits (EHB) requirements.^[176]

One organizational commenter expressed concerns about § 92.207(b)(1) and argued that this provision would impose new nondiscrimination tests on issuer business decisions that result in the denial or limitation of payment for a claim, on variations in cost sharing under the terms of a health plan, or on the imposition of other limitations or restrictions on coverage. The commenter argued this would result in expansive and detailed regulation of numerous issuer business decisions in an arbitrary and capricious manner.

Response: OCR appreciates commenters' concerns regarding cost sharing, which is explicitly addressed in § 92.207(b)(1). Covered entities are prohibited from “impos[ing] additional cost sharing or other limitations or restrictions on coverage, on the basis of race, color, national origin, sex, age, or disability.” We disagree with the commenter's concerns that this provision arbitrarily or capriciously imposes new nondiscrimination tests on issuer business decisions. Covered entities subject to this rule are prohibited from engaging in unlawful discrimination in their health programs or activities, including in health insurance coverage or other health-related coverage. Cost sharing is standard industry practice that is a feature of an issuer's health insurance coverage or other health-related coverage. Nothing in this rule dictates the business decisions an issuer should make in establishing its coverage limitations, including with regard to cost sharing. To the extent an issuer imposes cost sharing in its coverage, it cannot do so in a discriminatory manner. Comments related to violations of EHB requirements are outside the scope of this regulation.^[177]

Comment: Commenters generally supported the prohibition on discriminatory marketing practices in § 92.207(b)(2). Commenters discussed that covered entities might use marketing practices to dissuade enrollment by individuals with high-cost conditions. For example, commenters noted that plans present inaccurate or confusing information about formularies and hide or fail to provide information about certain drugs. Several commenters referenced a 2022 study by the AIDS Institute that found 57.9 percent of the 299 Exchange plan documents reviewed did not list PrEP (pre-exposure prophylaxis to prevent HIV infection) as a free preventive service, though health insurance issuers were required to include such coverage for all plans offered through the Exchanges in 2022.^[178] Commenters asked OCR to provide an example of discriminatory marketing practices in regulatory text. They further requested that OCR coordinate the study of marketing practices with other regulatory agencies.

Response: OCR concurs with the importance of ensuring that an issuer's marketing practices are not designed or implemented in a way that discriminates against individuals with a specific disability or on any other basis prohibited under section 1557. Inaccuracies or omissions in plan marketing materials may impede an individual's ability to determine what treatments and services are covered. While certain inaccuracies or omissions in marketing materials may not be prohibited discrimination under this section, inaccuracies or omissions that were intended to or resulted in discouraging individuals from enrolling in health insurance coverage and other health-related coverage or steering individuals away from enrolling in health insurance coverage and other health-related coverage on the basis of disability or other prohibited basis would raise concerns of prohibited discrimination. The determination of whether a particular marketing practice is prohibited under this section requires a case-by-case analysis dependent on the facts of the challenged marketing practice. Accordingly, OCR declines to specify particular examples in the regulation, though we included an example in the Proposed Rule, stating that covered entities that avoid advertising in areas populated by a majority of people of color to reduce the enrollment of people of color in their health insurance coverage could violate § 92.207. 87 FR 47869-70. We note that covered entities may be subject to other Departmental and Federal regulations governing marketing practices.^[179] While OCR declines to coordinate a study of marketing practices, we continue to coordinate with other regulatory agencies on health insurance-related matters.

We note that individuals with LEP or disabilities may face challenges in accessing a covered entity's marketing materials. This final rule addresses such concerns in multiple ways, including by requiring covered entities to provide a Notice of Nondiscrimination under § 92.10; a Notice of Availability under § 92.11 (including in member handbooks at § 92.11(c)(5)(x)); taking reasonable steps to provide meaningful access to individuals with LEP under § 92.201; and taking appropriate steps to ensure effective communication for individuals with disabilities under § 92.202.

Comment: Numerous commenters supported the prohibition on discriminatory health plan benefit designs in § 92.207(b)(2). Commenters stated that covered entities employ many features of benefit design and delivery to deny coverage or discourage people with significant or high-cost health needs from enrolling in their plans. These include exclusions, cost sharing, formularies, visit limits, provider networks, service areas, benefit substitutions, prior authorization, and other utilization management that the commenters allege are arbitrary and not clinically based or appropriate.

Some commenters requested that OCR define the term “benefit design” or include specific examples of benefit design features in the regulatory text of § 92.207(b)(2). While some commenters expressed concern that failing to define benefit design in the regulation would result in a lack of clarity as to what the rule prohibits, other commenters supported OCR's proposed approach to avoid defining the term in a prescriptive manner.

One organizational commenter opposed § 92.207(b)(2) as imposing nondiscrimination tests on insurance benefit design, which the commenter argued would result in expansive and detailed regulation of a number of issuer business decisions in an arbitrary and capricious manner.

Response: Benefit design features may result in a discriminatory denial of access to medically necessary care, particularly for individuals with disabilities who have significant health needs. To address this concern, covered entities are explicitly prohibited from having or implementing benefit designs Start Printed Page 37602 that discriminate on any protected basis as set forth under § 92.207(b)(2).

We decline to define “benefit design” or specify types of benefit design features in the regulatory text. Section 92.207(b)(2) sufficiently notifies covered entities that discriminatory benefit designs are prohibited under this rule. In addition, we seek to avoid being overly prescriptive or unintentionally inconsistent with other Departmental regulations that may define benefit design.^[180] While OCR declines to provide examples of specific benefit design features in the regulatory text, for purposes of applying section 1557 and this final rule, examples of benefit design features include, but are not limited to, coverage, exclusions, and limitations of benefits; prescription drug formularies; cost sharing (including copays, coinsurance, and deductibles); utilization management techniques (such as step therapy and prior authorization); medical management standards (including medical necessity standards); provider network design; and reimbursement rates to providers and standards for provider admission to participate in a network.

OCR disagrees with the organizational commenter's concern that this provision arbitrarily or capriciously imposes new nondiscrimination tests on issuer business decisions. This section does not dictate what business decisions an issuer must make in establishing its benefit design and does not specify any particular design feature must be included. OCR acknowledges that issuers have discretion in designing their plans; however, they must do so in a nondiscriminatory manner as discussed throughout this section.

Comment: Commenters requested that OCR provide a non-exhaustive list of presumptively discriminatory benefit design examples. Some commenters also suggested that OCR incorporate the presumptively discriminatory benefit design examples provided in CMS' EHB regulations ^[181] or otherwise rely on other nondiscrimination provisions in CMS regulations implementing the ACA. Commenters stated that allowing plan discretion on every benefit other than gender dysphoria undercuts the regulation. Many commenters stated that OCR should recognize that most benefit design elements are inherently discriminatory as they apply disproportionately to individuals with disabilities and chronic conditions. Commenters expressed concerns that without presumptively discriminatory benefit design examples, issuers will adopt designs that exclude or make lifesaving treatments unaffordable for individuals in protected categories. Commenters noted that such designs include cost-sharing requirements, restrictive medical necessity standards, narrow networks, drug formularies, adverse tiering, benefit substitution, utilization managements, exclusions, visit limits, quantity limits, waiting periods, service areas, and coercive wellness programs.

Response: OCR declines to provide specific examples of presumptively discriminatory benefit designs in the rule due to the fact-intensive analysis needed to determine whether a particular benefit design feature is discriminatory under this section. We also decline to give examples of presumptively discriminatory benefit designs similar to those in EHB regulations applicable to non-grandfathered health insurance coverage in the individual and small group markets that CMS finalized in the preamble of its Notice of Benefit and Payment Parameters for 2023 final rule.^[182] Essential health benefits are governed by CMS regulations and not by this final rule. While many of the practices cited by CMS would raise concerns of prohibited discrimination under this rule, OCR's determinations that a particular benefit design is discriminatory will be a fact-specific inquiry that OCR will conduct on a case-by-case basis. OCR's process for analyzing claims of discrimination in benefit design is discussed in more detail under the Benefit Design Analysis discussion later in this section. OCR will consider issuing guidance on discriminatory practices prohibited under this section in future guidance.

OCR disagrees that the prohibition against categorical exclusions or limitations of coverage for all health services related to gender transition or other gender-affirming care under § 92.207(b)(4) undercuts the regulation. Such explicit, categorical exclusions or limitations impermissibly single out an entire category of services based on an individual's transgender status and are presumptively discriminatory on the basis of sex as prohibited under this section. As discussed in detail under § 92.206, this rule includes specific provisions related to gender-affirming care given the widespread discriminatory denial of care for such services and its direct connection to an individual's transgender status.^[183] As discussed in more detail below, covered entities may raise a defense under § 92.207(c) where they contend that they have a legitimate, nondiscriminatory basis for a coverage limitation that may otherwise appear to constitute discrimination. Recipients may also rely upon §§ 92.3 and 92.302(a) or request an assurance of exemption under § 92.302(b) based on their view that religious freedom or conscience protections apply.

We also decline to incorporate examples of presumptively discriminatory benefit designs similar to those in EHB regulations applicable to non-grandfathered health insurance coverage ^[184] in the individual and small group markets that CMS finalized in the preamble of its Notice of Benefit and Payment Parameters for 2023 final rule. Essential health benefits are governed by CMS regulations and are not addressed by this final rule. While many of the practices cited by CMS would raise concerns of prohibited Start Printed Page 37603 discrimination under this rule, OCR's determinations that a particular benefit design is discriminatory will be a fact-specific inquiry that OCR will conduct on a case-by-case basis. OCR's process for analyzing claims of discrimination in benefit design is discussed in more detail under the Benefit Design Analysis discussion later in this section. OCR will consider issuing guidance on discriminatory practices prohibited under this section in future guidance.

Comment: Commenters asked OCR to include examples of discriminatory benefit design specifically related to prescription drug formularies. These commenters provided examples of practices they considered to be discriminatory, such as issuers placing most or all drugs used in the treatment of certain conditions into the highest cost sharing tier; excluding single tablet regimens even when they are the standard of care for a condition; requiring the use of specialty pharmacy programs that require mail delivery even when that adds unnecessary and burdensome administrative barriers and delays to obtaining drugs; and using quantity limits for an entire class of medications without scientific or clinical explanation. Commenters expressed concerns that discriminatory prescription drug formularies discourage enrollment among certain populations, including individuals with HIV, mental health needs, or other chronic conditions. Commenters noted that enrollees who need high-cost medications often must choose between plans that will provide adequate coverage of their medication or plans that cover their preferred providers. A commenter cited a study that showed that Black and Hispanic/Latino people are more likely to abandon medications at the pharmacy because of high cost.^[185] Finally, some commenters recommended that OCR develop specific mechanisms to monitor prescription drug formulary practices and coverage of physician-administered “medical benefit” drugs to ensure that formularies are not used to discriminate against patients with specific disabilities.

Response: Benefit design practices related to prescription drugs have an enormous impact on individuals' access to medically necessary medication. Coverage of prescription drugs could pose concerns of prohibited discrimination and OCR would investigate such practices under the rule on a case-by-case basis. OCR declines to state that specific practices are per se discriminatory under the rule because each investigation is a fact-specific inquiry, based on nondiscrimination principles and relevant case law,^[186] including consideration of the covered entity's reason for the design feature in question.

As discussed in the Proposed Rule, several benefit design practices related to drug formularies could be discriminatory under this section, including prescription drug formularies that place utilization management controls on most or all drugs that treat a particular condition regardless of their costs without placing similar utilization management controls on most or all drugs used to treat other conditions, and benefit designs that place utilization management controls on most or all services that treat a particular disease or condition but not others. 87 FR 47874. OCR notes that coverage of physician-administered “medical benefit” drugs would be considered part of a plan's benefit design and therefore subject to this rule.

While we identify some prescription drug practices above that may raise concerns under section 1557, this rule does not prohibit covered entities from engaging in nondiscriminatory practices related to prescription drug benefit design. For example, covered entities may utilize preferred drug lists, such as preferred drug lists under the Medicaid program under title XIX of the Social Security Act, as long as the coverage criteria does not constitute prohibited discrimination. In addition, as discussed in more detail below, covered entities are not prohibited from applying nondiscriminatory utilization management techniques in their drug formularies.

Comment: Many commenters expressed concerns about benefit designs that impose coverage limitations or exclusions related to health services that could result in discrimination on the basis of disability. For example, some commenters argued that plans should not be permitted to have blanket exclusions for services related to ASD or applied behavioral analysis (ABA) therapy, a therapeutic intervention sometimes recommended for autistic children.

Several commenters raised concerns about how frequently insurance benefit design practices inappropriately limit coverage of durable medical equipment. Commenters noted that issuers place unique annual coverage caps on items such as wheelchairs, ventilators, and hearing aids. A commenter noted an example of an individual with hearing loss that requires treatment other than cochlear implants being denied coverage of hearing aids and outpatient visits to an audiologist due to their issuer's blanket exclusion of programs or treatments for hearing loss other than cochlear implants. Another commenter noted that issuers limit coverage of multiple-use speech-generating devices, which are most useful and effective for autistic individuals, even when those devices are less expensive than single-use speech generating devices.

Other commenters expressed concerns that covered entities include clinically inappropriate limits on the coverage of habilitative and rehabilitative services and devices. Commenters noted that such limitations, including on the number of covered visits, discriminate against people with more significant disabilities who need extensive habilitation or rehabilitation in order to gain, regain, or maintain functioning. Commenters requested that OCR clarify that blanket limitations or exclusions of habilitative services for individuals with specific disabilities are prohibited discrimination under section 1557 when those same services are allowed for rehabilitation of nondisabled persons. Commenters noted that people with developmental disabilities are routinely denied coverage for habilitative services needed to gain skills or improve functioning while an identical service is covered for individuals who require it for rehabilitative care to restore functioning. For example, a commenter noted that coverage of “speech therapy to restore speech” results in excluding all children with developmental delays who need the therapy to attain speech. Commenters noted that habilitative services are important for children who are delayed in walking or talking or need to learn other muscular skills for the first time and for individuals with disabilities to be able to live as independently as possible.

Response: OCR appreciates the variety of concerns raised by commenters. A coverage limitation or exclusion that is based on a specific disability or condition (or other basis prohibited by section 1557, such as age, discussed below), would be investigated as Start Printed Page 37604 potentially discriminatory under this rule. Blanket exclusions of all treatments related to a particular condition, such as ASD or hearing loss, would raise significant concerns of prohibited discrimination on the basis of disability such that OCR would expect the covered entity to provide a legitimate, nondiscriminatory reason for the exclusion. Non-categorical exclusions or limitations for certain treatments related to a specific disability or condition may also raise concerns under the rule. This rule, however, does not require covered entities to cover all services related to a specific disability or condition. Application of standard disability discrimination principles requires a specific analysis of each claimed exclusion. We therefore decline to expressly state that a particular coverage exclusion or limitation is per se discriminatory on the basis of disability under this rule. Determinations of whether a particular coverage exclusion or limitation is discriminatory will be evaluated on a case-by-case basis, in accordance with longstanding civil rights principles and relevant case law, as discussed throughout this section. When investigating a potentially discriminatory exclusion or limitation, OCR will consider whether the covered entity has a legitimate, nondiscriminatory reason for the challenged design feature. If OCR determines that the covered entity's reason is a legitimate, nondiscriminatory reason that is not a pretext for discrimination, OCR will conclude that the challenged exclusion or limitation is not prohibited under the rule.

Regarding durable medical treatment, the commenters' example of exclusions of coverage for programs or treatments for hearing loss other than cochlear implants has been the subject of at least two court cases where the courts have held that such exclusions do not state a claim for proxy disability discrimination under section 1557.^[187]

We also note that health insurance issuers may be subject to other Departmental authorities that are relevant to issues raised by commenters.^[188] For example, to the extent durable medical equipment is an EHB, like hearing aids are in some states, covered entities may also be subject to CMS' EHB nondiscrimination regulations at 45 CFR 156.125 applicable to non-grandfathered health insurance coverage in the individual and small group markets.^[189] Further, CMS' EHB regulations require coverage of habilitative services and devices, and specify that plans may not impose limits on coverage of habilitative services and devices that are less favorable than limits imposed on coverage of rehabilitative services and devices.^[190]

Comment: Many commenters raised concerns related to mental health services. Commenters asked OCR to require both public and private payers to remedy the current inadequacies and inequities in mental health service reimbursement rates and policies, explaining that reimbursement rates have been historically lower for mental health services than physical health services. Commenters also identified a range of specific mental health benefit design inequities, including the need for intermediate-care facility coverage for high-use patients with non-urgent care needs to mobile crisis response that is on par to that of physical emergency response. Commenters also requested that the rule align with the mental health parity protections in the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA).

Response: OCR acknowledges commenters' concerns regarding coverage for mental health services. Mental health services may be needed by people who may or may not be individuals with disabilities under this rule. OCR will examine complaints alleging less favorable treatment for mental health coverage as compared to physical health coverage on a case-by-case basis to determine if the coverage discriminates against people with disabilities. Reimbursement rates and policies are subject to § 92.207 as part of a plan's benefit design, and thus must be provided in a nondiscriminatory manner. We also discuss reimbursement rates in the context of the integration provision under § 92.207(b)(6).

We decline to incorporate or align this rule with MHPAEA, as section 1557 is a distinct Federal civil rights law. We note that coverage limitations found to violate section 1557 may also be prohibited under MHPAEA.^[191]

Comment: Commenters expressed concerns about issuers discriminating against enrollees based on age through certain benefit designs. Commenters provided examples of practices they believed to be discriminatory, such as issuers requiring an ASD diagnosis by a certain age to access coverage for ASD-related health care; not covering hearing aids for adults when otherwise covered for children; and imposing limitations on wheelchair and mobility device replacement for children that fail to align with how quickly children outgrow such devices. One commenter asked that OCR require issuers to attest that their pediatric benefit packages are comprehensive and age-appropriate by demonstrating that physical and mental health benefits do not have age, visit, or coverage limits that are not based on medical necessity or that are based on adult metrics. Commenters noted that plans that limit coverage to specific conditions or a child's capacity to attain a certain functional status will unfairly prevent many children with special health care needs from accessing critically important services.

Response: Section 1557 prohibits discrimination on the basis of age, consistent with the Age Act and its implementing regulations. The Age Act allows age distinctions under certain circumstances, including distinctions Start Printed Page 37605 that reasonably take into account age as a factor necessary to the normal operation or the achievement of any statutory objective ^[192] of a program or activity; are based on age-related factors that bear a direct and substantial relationship to the normal operation of the program or activity or to the achievement of a statutory objective; provide special benefits to the elderly or children; or are contained in a rule or regulation issued by the Department.^[193] As a result, not all age-related distinctions in State or Federal law, including Department regulations, are prohibited by section 1557.^[194] As noted above, these permissible age distinctions form part of the “ground” of discrimination prohibited under the Age Act, because they identify distinctions that either are not forbidden age discrimination, 42 U.S.C. 6103(b)(1)(A) (“reasonably takes into account age as a factor necessary to the normal operation or the achievement of any statutory objective of such program or activity”), or are not age discrimination at all, id. section 6103(b)(1)(B) (“based upon reasonable factors other than age”).

When investigating a benefit design with an age distinction, OCR will first determine whether the distinction is permitted under the Age Act (and therefore section 1557). If it is not, OCR will then investigate the age distinction to determine whether it violates section 1557. As with other benefit design investigations, OCR's analysis will involve a fact-specific inquiry and will consider a covered entity's reason for the age distinction in its benefit design. The covered entity's justification must be a legitimate, nondiscriminatory reason, as discussed under § 92.207(c). For example, if an issuer is not able to provide a legitimate, nondiscriminatory reason to substantiate an age distinction in ASD coverage, such an age distinction would likely violate section 1557. We reiterate that this rule does not require a covered entity to provide coverage for all health services related to a particular disability or condition; rather, it requires covered entities to design their plan benefits in a nondiscriminatory manner. We note that covered entities may also be subject to relevant CMS EHB nondiscrimination regulations regarding presumptively discriminatory age distinctions.^[195]

OCR does not agree that it is necessary to require a separate attestation related to pediatric benefit packages. As recipients of Federal financial assistance, issuers are required to submit an Assurance of Compliance with section 1557 under § 92.5, which attests that they will not discriminate on the basis of age, among other prohibited bases.

Comment: A commenter requested that OCR clarify the obligation of issuers and plan administrators to ensure that their staff, as well as the staff of any subsidiary entities with which they do business, receive explicit training on the relationship between benefit design choices and practices and activities that can amount to discrimination based on race, color, national origin, sex, age or disability.

Response: Covered entities are responsible for ensuring their staff, subrecipients, and subcontractors are compliant with section 1557. Section 92.9 requires covered entities to provide training to relevant employees on their section 1557 Policies and Procedures, and while we note that it is in a covered entity's best interest to ensure that relevant staff are adequately trained, we decline to specify additional training requirements at this time.

Comment: Commenters requested that the final rule expressly state that section 1557 prohibits proxy discrimination in benefit design, either in the preamble or regulation. Commenters expressed concern that absent express incorporation of proxy principles, covered actors may attempt to evade section 1557's nondiscrimination provisions. A commenter requested that the final rule incorporate established discrimination principles and noted that issuers continue to justify discriminatory plan designs by taking the position that health plans that target a particular medical service rather than a disability are neutral or uniform with respect to all enrollees. As an example, the commenter noted that plans restricting coverage of dialysis justify it as not being discriminatory against enrollees with end-stage renal disease. The commenter requested that the final rule declare that discriminatory plan designs that limit dialysis treatment are a form of prohibited disability discrimination under section 1557 due to the fact that dialysis services are a near perfect proxy for end-stage renal disease, according to the commenter.

Response: Proxy discrimination occurs when a policy or practice treats individuals differently on the basis of seemingly neutral criteria that are so closely associated with the disfavored group that discrimination on the basis of such criteria is, constructively, facial discrimination against the disfavored group.^[196] Proxy discrimination is one of many basic civil rights theories available to OCR when investigating complaints under section 1557 and which courts have applied in cases alleging discrimination under section 1557.^[197] Due to the fact-intensive nature of the analysis necessary, including determinations of whether a particular benefit design is discriminatory,^[198] we decline to expressly include this theory of discrimination in the rule text. As we have noted above, all claims under this section will be evaluated on a case-by-case basis.

Comment: Some commenters noted that health insurance coverage and other health-related coverage may employ coverage limitations that are facially neutral and apply to all enrollees but have a disparate impact on a basis protected under section 1557. Specifically, commenters observed that these limitations and exclusions can have a particular discriminatory effect on individuals with disabilities who have chronic conditions and significant health needs.

Response: OCR utilizes all applicable causes of action when investigating potential discrimination under section 1557 consistent with relevant case law. For further discussion related to OCR's enforcement procedures, see § 92.301. Start Printed Page 37606

Comment: Commenters requested that the final rule make clear the language in § 92.207(b), which addresses sex-related health services, includes the full spectrum of reproductive health services and treatments and medications for people with disabilities that may prevent, complicate, or end fertility or pregnancies.

Response: OCR appreciates the unique challenges faced by people with disabilities seeking reproductive health care. Section 1557 prohibits discrimination on prohibited bases regardless of the type of care an individual is seeking or receive. Therefore, we do not believe it is necessary to provide specific provisions related to each form of care an individual may seek.

Comment: Commenters requested that the final rule expressly state that infertility diagnoses, treatment, and services, including assisted reproductive technology, if offered, must be covered without regard to sexual orientation, gender identity, sex characteristics (including intersex traits), or any other protected basis. Commenters raised several examples of benefit design or coverage related to assisted reproductive technology that they stated should be prohibited as discriminatory against individuals based on their relationship status and sexual orientation. As examples, commenters cited requiring enrollees to use their spouse's sperm to fertilize their eggs for in vitro fertilization and requiring that single enrollees or those in non-heterosexual relationships pay out of pocket for a predetermined number of failed intrauterine insemination cycles before providing coverage when heterosexual couples do not have to meet the same standard. Commenters stated that issuers justify these types of benefit design features on outdated definitions of infertility. A commenter argued that in vitro fertilization coverage should include screening for genetic abnormalities that are unique to enrollees' lineage as a matter of reproductive justice and religious freedom.

Response: OCR agrees that to the extent plans cover infertility diagnosis, treatment, and services, including assisted reproductive technology, they must do so on a nondiscriminatory basis, including for same-sex couples. Due to the fact-intensive nature of the analysis necessary, determinations of whether a particular benefit design is discriminatory under this section will be evaluated on a case-by-case basis.

Comment: Commenters recommended that OCR add a new paragraph to § 92.207(b) affirming that denying or limiting coverage of, or coverage of a claim for, health services because they may prevent, cause complications to, or end fertility or pregnancies is prohibited. Commenters asserted this language would address discrimination by a State program that otherwise provides coverage of contraceptives but excludes a specific contraceptive because of a medically inaccurate assertion that the contraception causes an abortion, or a provider network that only includes facilities that refuse to provide certain types of contraception. Commenters emphasized that individuals are currently being improperly denied access to medications or treatments for care unrelated to abortion because the medicine is also used for abortion care.

Response: Denying access to specific medication or health services that may potentially be used for medication abortion purposes but are prescribed for reasons unrelated to abortion care may constitute discrimination under section 1557.^[199] OCR finds it unnecessary to add any additional regulatory language to prohibit such discrimination on the basis of disability and sex. As noted above, simultaneous discrimination on multiple prohibited bases is important to account for and is prohibited by section 1557.

Comment: A commenter asked OCR to provide confirmation that while nothing in the regulation would require a covered entity to cover abortions, to the extent plans do cover abortions, they must do so on a nondiscriminatory basis.

Response: As the commenter stated, nothing in this rule requires the provision of any particular medical care, including abortion. To the extent plans offer coverage for termination of pregnancies and related services, they must do so on a nondiscriminatory basis.

Comment: Commenters recommended that OCR revise the regulatory text of proposed § 92.207(b)(4) and (5) to address sex discrimination related to pregnancy or related conditions by adding discrimination related to abortion, fertility care, and contraception. Some commenters requested that OCR specifically add “termination of pregnancy, contraception, fertility care, miscarriage management, pregnancy loss, maternity care, other reproductive and sexual health services, or any health services” to the prohibitions on exclusions, limitations, and cost sharing related to gender transition or other gender-affirming care in § 92.207(b)(4) and (5).

Response: OCR declines this suggestion. Section 92.207(b)(4) and (5) are not intended to list all types of potentially prohibited exclusions. The general prohibition on discriminatory limitations under § 92.207(b)(1) would apply to any exclusion or limitation related to all types of care that resulted in discrimination on the basis of sex.

Comment: Some commenters stated that they oppose § 92.207 to the extent it violates religious freedom and conscience protections. Other commenters stated that they opposed § 92.207 because it prevents plans from excluding coverage of all gender affirming care.

Response: Section 92.207 does not violate such protections because providers may rely on the protections of Federal religious freedom and conscience laws or choose to seek assurance of those protections from OCR under this final rule. With respect to concerns about potential conflicts between provisions of the final rule and individuals' or organizations' conscience or religious freedom, please refer to the preamble discussion of § 92.302. Additionally, we are revising § 92.207(c) to specify that nothing in this section precludes a covered entity from availing itself of protections described in § 92.3 and § 92.302. This modification is consistent with the revised language in § 92.206(c). As noted elsewhere in this preamble, and in § 92.3(c), insofar as the application of any rule requirement would violate applicable Federal protections for religious freedom and conscience, such application shall not be required.

Comment: Many commenters expressed strong support for the provisions in § 92.207(b)(3) through (5), citing the extensive discrimination faced by transgender people in the health insurance coverage and other health-related coverage context. Several legal service providers described their experiences assisting clients facing various types of discrimination in their health plans, even where State law or the plan terms provided some protection for gender-affirming care. Some commenters noted these provisions also addressed forms of discrimination commonly faced by intersex people. Commenters noted that the physical, mental health, and financial costs of such discrimination could be high, with individuals forgoing necessary care, facing extreme financial Start Printed Page 37607 burdens, and experiencing distress when denied access to necessary medical care.

Both supporters and opponents of the Proposed Rule raised many of the same issues discussed in § 92.206(b)(4) (prohibiting categorical coverage exclusions on gender transition or other gender-affirming care) and (c) (discussing legitimate, nondiscriminatory reasons for denying or limiting care) above. As with § 92.206, some commenters asked OCR to define gender-affirming care or provide more detail about what types of care must be covered.

Response: OCR agrees that transgender and intersex people have long faced discrimination in the health insurance coverage and other health-related coverage context. Many of OCR's responses to the comments in § 92.206(b)(4) (prohibiting categorical coverage exclusions on gender transition or other gender-affirming care) and (c) (discussing legitimate, nondiscriminatory reasons for denying or limiting care) above are applicable to the comments in this section as well. For example, for the reasons we discussed above, we will not provide a definition of “gender-affirming care” in the regulation text.

Comment: Commenters noted that even plans without categorical exclusions will exclude certain types of gender-affirming care as “cosmetic.” Commenters noted that categorizing procedures as cosmetic when needed for gender-affirming care is contrary to established standards of care for the treatment of gender dysphoria and urged OCR to explicitly prohibit such procedure-specific exclusions. Some commenters further noted that plans will often consider these procedures on a case-by-case basis when not related to gender transition but will not do so when the care is related to gender transition.

Many commenters recommended deleting the word “all” from § 92.207(b)(4) to make clear that the exclusion of any gender-affirming care from coverage is prohibited. Some commenters stated that this change would be more consistent with § 92.207(b)(5), which more generally prohibits discriminatory limits on gender-affirming care coverage.

Response: OCR appreciates commenters' feedback and concern about forms of discrimination beyond broad categorical coverage exclusions. While we understand that some gender-affirming care exclusions are limited to the specific type of care at issue, we decline to revise the language of § 92.207(b)(4). Section 92.207(b)(5)'s general prohibition on limitations or restrictions on coverage for gender transition or other gender-affirming care reaches the narrower exclusions or restrictions on gender-affirming care.

We also decline to state that any denial of gender-affirming care will necessarily be discriminatory regardless of context or rationale. We will instead consider claims of discrimination raising non-categorical denials on a case-by-case basis. Where OCR receives complaints about such exclusions or restrictions, we will investigate on a case-by-case basis whether they constitute prohibited discrimination under § 92.207(b)(5) or any other applicable provision of the rule. Since section 1557 only prohibits discrimination and does not prescribe any specific standard of care, such denials will violate the final rule only where they entail discrimination on the basis of sex. As stated throughout this section, covered entities will have the opportunity to provide a legitimate, nondiscriminatory reason for such exclusions or restrictions.

Comment: Some commenters proposed striking the phrase “if such denial, limitation, or restriction results in discrimination on the basis of sex” from § 92.207(b)(5), stating that the elimination would make this provision clearer. Commenters viewed this phrase as confusing and redundant, as they stated that limiting or restricting coverage for services related to gender-affirming care is necessarily discriminatory. Another commenter noted the intersectionality of discrimination and stated that this language may be limiting.

Response: For the reasons discussed above, we disagree that any restriction impacting gender-affirming care will necessarily constitute prohibited discrimination. For example, if an insurance plan places restrictions on coverage for gender-affirming surgeries that are no more stringent than the restrictions placed on any other type of surgical care, those restrictions will not violate the rule. As such, we decline to make the deletion proposed by these commenters.

OCR agrees that the rule prohibits discrimination in the provision or coverage of gender-affirming care whether it is on the basis of sex or on the basis of race, color, national origin, age, or disability. That said, allegations about such discrimination are best brought under § 92.207(b)(1), as § 92.207(b)(5) is aimed at the types of denials or limitations on coverage that are based on a person's gender identity and are thus a form of sex discrimination.

Comment: Commenters noted that even plans without categorical exclusions of gender-affirming care may adopt barriers to accessing such care, such as more stringent pre-approval processes. The commenters noted that these requirements could result in transgender people ultimately not receiving necessary care or having to invest significant time and resources to navigate the barriers. Some commenters additionally noted the high mental health toll on individuals facing discriminatory limitations on medically necessary care.

Response: OCR appreciates the commenter's feedback and concern about the forms of discrimination transgender people encounter in seeking coverage for gender-affirming care but declines to revise § 92.207(b)(3) as suggested. Section 92.207(b)(5) prohibits limitations or restrictions on coverage for gender transition or other gender-affirming care.

Comment: Many commenters supported the provisions limiting issuers' ability to deny care based on a person's sex assigned at birth, gender identity, or gender otherwise recorded, noting that transgender, nonbinary, and intersex people can all face such discriminatory denials. Other commenters objected to these provisions, expressing concern that this would compel issuers to pay for care that was not medically necessary or appropriate for a given individual.

Response: Section 92.207(c) makes clear that a nondiscriminatory determination that care is not medically necessary based on a patient's anatomy or medical need is permissible. For example, this final rule would not prohibit a covered entity from denying coverage for preventive health services for a transgender patient where such care is not medically necessary, such as a prostate exam for a transgender man who does not anatomically have a prostate. In contrast, the rule may prohibit a covered entity from denying coverage for medically necessary preventive care for a transgender patient.

Comment: One provider group urged OCR to work with the Office of the National Coordinator for Health Information Technology (ONC) and electronic health record vendors to ensure that there are options for separately identifying a patient's gender identity and anatomy to reduce the risk of improper denials.

Response: OCR appreciates the suggestion that discriminatory denials could be reduced if the records systems used by providers, issuers, and other covered entities provide better options Start Printed Page 37608 for recording gender identity and sex characteristics. While minimum standards for record systems are not within the scope of the rule, we are committed to working with ONC and other relevant stakeholders to explore solutions to this issue.

Comment: Commenters noted that transgender people often have difficulty getting their health coverage to update their records to reflect their correct name and gender. Commenters noted that gender marker mismatches in health insurance records can result in denial of coverage for clinically appropriate care, and one commenter urged OCR to make clear that claims processing procedures that automatically deny coverage for care based on a perceived mismatch of sex or gender is a form of impermissible sex discrimination.

Response: OCR appreciates commenters' concerns about coverage denials due to a sex mismatch in claims processing procedures, which can result in transgender patients being denied coverage for a medically necessary and clinically appropriate services. However, we decline to categorically state that sex mismatch denials are always discriminatory. Instead, OCR will consider and investigate complaints raising this issue on a case-by-case basis under § 92.207(b)(3). While we refrain from categorically stating that initial sex mismatch or coding denials are prohibited under this rule, we caution that denials resulting in an undue delay or denial of services, such as repeated denials, could result in a finding of prohibited discrimination. For more information on OCR's view of this issue, please see the 2016 Rule preamble's discussion on computer systems with gender coding resulting in gender mismatches at 81 FR 31436.

Comment: With respect to cases where coverage for comparable treatments is relevant to the discrimination analysis, some commenters urged OCR to clarify that the question of what is comparable can be construed broadly, rather than parsing minor differences in broadly similar types of care.

Response: OCR declines to identify a bright line of how similar care must be to be considered comparable when such considerations are relevant to a discrimination claim, as there are many factors that may be relevant to this analysis, and our approach is case by case.

Comment: Commenters who addressed the integration requirement in § 92.207(b)(6) overwhelmingly supported the newly proposed provision, which clarifies the prohibition on having or implementing benefit designs that do not provide or administer health insurance coverage or other health-related coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities. Several noted the particular importance of this provision and access to community integration in light of the COVID-19 pandemic and the higher infection risks associated with congregate settings. A few commenters noted the role that discrimination on multiple bases may play with regard to community integration, highlighting the overrepresentation of people of color in institutional settings, and the relationship between access to effective communication and community integration. Numerous comments included examples of current practices that may violate the integration provision.

Commenters agreed that this provision should apply to both benefit design and implementation of a benefit design, including: coverage, exclusions, and limitations of benefits; prescription drug formularies; cost sharing (including copays, coinsurance, and deductibles); utilization management practices; medical management standards (including medical necessity standards); provider network design; provider reimbursement; standards for provider admission to participate in a network; benefits and service administration contracted to third parties, such as pharmacy benefit managers; and quality measurement and incentive systems. Many commenters requested that OCR clarify that the convenience or potential cost-saving of administering treatments in institutional settings are not legitimate, nondiscriminatory reasons for not providing comparable benefits in less restrictive settings.

Commenters suggested that providing coverage to qualified individuals with disabilities in the most integrated setting appropriate should not be done in a way that unnecessarily increases costs for all enrollees or compromises individual health benefits.

Response: We appreciate support for the inclusion of this provision. OCR recognizes the importance of providing and administering health coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities; we also recognize that discrimination on multiple bases heightens barriers and are committed to addressing allegations of discrimination on all bases protected under section 1557. As discussed in the Proposed Rule, 87 FR 47873, this provision encompasses both the benefit design of the benefit being offered by a covered entity as well as the indirect mechanisms that affect the implementation of the benefit design within a covered entity's control, such as utilization management practices, provider reimbursement, contracting out to third-party contractors such as pharmacy benefit managers, and quality measurement and incentive systems. OCR is not prescriptive in the list of potential mechanisms that could result in prohibited discrimination through implementation of a benefit design because it is a case-by-case analysis depending on the facts of each situation.

With respect to concerns about unnecessarily increasing costs to comply with this provision, OCR notes that institutional care is generally more expensive than community-based care and that increased cost alone is not necessarily a fundamental alteration.^[200] However, concerns related to cost can be raised through a fundamental alterations defense.^[201]

Comment: Nearly all commenters who addressed this provision agreed with the 2022 NPRM preamble language stating that requiring prior authorization, step therapy, or other utilization management when individuals access treatment in the community but not in an institution, would constitute discrimination if the discrepancy results in unnecessary segregation or a serious risk of unnecessary segregation. Commenters noted that these practices place additional terms and conditions on the receipt of certain benefits in integrated settings that are not in place within segregated or institutional settings, and that they can often delay care and cause unnecessary institutionalization. For example, commenters asserted that people with physical and sensory disabilities, complex medical needs, and people with psychiatric and mental disabilities are often required to try less expensive and often unsuccessful medication ( i.e., step therapy) before being able to access effective treatments in the community. If utilization management techniques are only required for community-based treatment and not for institutional care, commenters argued this may push individuals urgently in need of care into institutional setting so they can access treatment more quickly. In contrast, one commenter suggested that it may be clinically appropriate to distinguish between institutional settings and home and community-based settings (HCBS) through the use of medical management Start Printed Page 37609 tools like prior authorization and step therapy due to closer monitoring by medical professionals in institutional settings.

Response: OCR shares commenters' concerns about the potential discrimination associated with the serious risk of institutionalization. The integration mandates of the ADA and section 504 apply to people with disabilities who are at serious risk of segregation or institutionalization, not only to people with disabilities who are currently in institutions.^[202] For example, an individual could show sufficient risk of institutionalization such that it would constitute a violation of this provision if a covered entity's failure to provide community services or its cut to such services will likely cause a decline in health, safety, or welfare that result in the serious risk of institutionalization or segregation.

As articulated in the Proposed Rule, 87 FR 47873, step therapy and other utilization management practices that impose different standards on members or beneficiaries in the community than in institutional settings are discriminatory if the discrepancy results in unnecessary segregation or a serious risk of unnecessary segregation. Section 1557's incorporation of section 504's integration provision through § 92.101(b)(1) makes clear that serious risk of institutionalization is covered under section 1557 as well, given that the vast majority of courts have found section 504 and title II of the ADA prohibits actions, omissions, policies, and practices that place individuals at serious risk of unjustified isolation. Indeed, nearly every court of appeals to address the issue has held that the integration mandate of the ADA and section 504 apply not only to people with disabilities who are currently in institutions, but also to people with disabilities who are at serious risk of segregation or institutionalization.^[203] As noted in Fisher v. Oklahoma, the integration mandate's “protections would be meaningless if plaintiffs were required to segregate themselves by entering an institution before they could challenge an allegedly discriminatory law or policy that threatens to force into segregated isolation.” ^[204] Likewise, section 1557's integration mandate would ring hollow if individuals were required to show that they have already had to submit to institutionalization in order to assert their right to receive services in the most integrated setting appropriate to their needs.

Further, even if a serious risk of unnecessary institutionalization was not an actionable claim in and of itself, it would still be appropriate for courts to grant relief to those at serious risk in order to prevent the unnecessary institutionalization prohibited by law.^[205] For these reasons, the rule's integration provision explicitly prohibits benefit design that results in a serious risk of institutionalization.

Plans continue to be able to limit services, use utilization review standards, and employ other limitations to manage costs as long as they are not discriminatory in doing so.

OCR has revised the regulation text to clarify that the integration requirement under section 1557 extends to practices that result in the serious risk of institutionalization or segregation. We recognize that the question of what constitutes “serious risk” is a fact-based inquiry, which is why the Federal courts to have considered the question have provided only general guidance on determining risk rather than an exhaustive test.^[206]

Comment: Several commenters strongly disagreed with the 2022 NPRM preamble language that stated that a State Medicaid program would generally not be required to provide a new benefit because that would fundamentally alter the nature of the program. Commenters noted that a State Medicaid program or other covered entity may have to expand its HCBS waiver programs or modify eligibility for particular services where necessary to satisfy the integration provision, and that there are many situations in which a State program has been required to create a “new” community-based benefit, where that benefit was previously only available in institutional settings. For example, commenters stated that a covered entity that provides for residential treatment for certain substance use disorder conditions and does not provide coverage of such services in appropriate community-based settings may need to create a “new benefit” by offering an existing institutional benefit in the community.

Response: After considering these comments, we clarify here that while a State Medicaid program is not required to create “new” programs to assist people with disabilities, nor are states required to provide a particular standard of care or level of benefits, covered entities must nevertheless adhere to section 1557's disability nondiscrimination requirements—including the integration requirement—with regard to the services they in fact provide. When a covered entity chooses to provide a service, it must do so in a nondiscriminatory fashion by ensuring access to that service in the most integrated setting appropriate to the needs of the qualified individual.^[207] States may be required to offer services in an integrated setting that they have only been offering in segregated settings; that is not offering a “new service,” but instead is ensuring the service is offered in integrated settings and not just in segregated settings.^[208]

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OCR clarifies that a program providing community-based services that are already available in institutional settings is not a new program for purposes of evaluating a fundamental alteration defense.^[209] In addition, states may be required to offer services in an integrated setting that have only been offered in a segregated setting. Providing services beyond what a State currently covers under its Medicaid program may not be a fundamental alteration under § 92.205 (Requirement to make reasonable modifications), and existing nondiscrimination law, including section 504 and the ADA,^[210] may require states to provide those services, under certain circumstances. In addition, to the extent that a benefit, including an optional benefit, is already provided in institutions as part of the State's program, the same or a substantially similar benefit must be offered in the community in a manner that does not incentivize institutional services over community services.

Comment: OCR received many comments in response to our request for comment on the application of the integration provision to State Medicaid programs. A number of comments related to Medicaid program designs required by title XIX of the Social Security Act. One commenter recommended that any action by a State Medicaid authority to reduce the existing scope of Medicaid-funded home and community-based long term services and supports, or to more strictly limit eligibility for them, that would have the effect of forcing people with disabilities who currently do, or could, live in their own homes and participate in unrestricted community activities into segregated, congregate, and/or institutional residential or day settings, or to cease their current level of community participation, on the basis of any general categorization of disability would be discriminatory under this provision.

Response: We appreciate the many comments highlighting potential issues related to community integration and State Medicaid programs. This rule does not impact the ability of states to target benefits under section 1915(c), section 1915(i), or section 1937 of the Social Security Act, consistent with Medicaid law. At the same time, the fact that a State chooses to use a Medicaid authority to target a particular disability population does not relieve a State of its obligations towards other populations. We will continue to work with our partners in CMS to ensure the robust provision of services in a nondiscriminatory manner to the maximum extent possible. We remind covered entities that obligations under the Medicaid statute are distinct from obligations under section 1557, and compliance with Medicaid requirements does not per se constitute compliance with section 1557.

Comment: A significant number of commenters raised concerns with “use-in-the-home” policies, where an insurance issuer will cover the provision of a benefit or service solely for use “in the home.” For example, commenters discussed that a covered entity might offer supplemental oxygen equipment for use in the home but decline to provide sufficient oxygen or equipment for an individual to access the broader community. Similarly, commenters noted that issuers might decline to cover medically necessary wheelchairs with functions that an individual needs to access the broader community outside their home. Commenters also provided examples of other kinds of medical diagnostic equipment, durable medical equipment, and home-use devices that are often not covered, but which would replace services provided in an institution and enable individuals to receive care in their home and community.

Commenters expressed concern that many State Medicaid programs, delegated managed care companies, and employer-sponsored private health plans have adopted the Medicare Mobility Assistive Equipment Coverage Policy ^[211] (a policy designed specifically to apply in the context of Medicare Part B) as their policy, despite what commenters see as the statutory differences between Medicare Part B and other authorities. Commenters contended that the unnecessary and unmandated adoption of such a policy in all programs unnecessarily restricts benefits to a low bar, denying people the ability to live in the most integrated setting possible.

Response: We appreciate the concerns raised by commenters. Each covered entity should review any legal authority governing the coverage they may provide to ensure that they are not interpreting it in a manner that results in discrimination. For example, Medicaid programs that impose homebound or “in-the-home” criteria that are not statutorily required under Federal law may be unnecessarily restricting services in the community in violation of civil rights laws. Where an in-the-home restriction is included in a statute, covered entities may not automatically deny coverage for any good or service that may also have use outside of the home, but must assess each claim to determine whether the denial will violate the most integrated setting requirement.

Comment: Many commenters expressed the need for § 92.207(b)(6), due to states increasingly turning to managed care plans to deliver Medicaid benefits. These commenters expressed concern that large issuers that administer a range of private employer plans and individual plans, as well as public Medicare and Medicaid plans, could employ uniform coverage policies across their plans that do not adequately support community integration. Commenters additionally noted that that Medicaid agencies should monitor whether Medicaid Managed Care Organizations (MCOs) are appropriately authorizing services in the community and that under current law states contracting with MCOs cannot escape liability when MCOs discriminate against people with disabilities.

Response: We appreciate the concerns raised by commenters. We recognize the increasing reliance on alternative payment models for the delivery or management of services to individuals with disabilities. The shift towards managed care in State Medicaid programs and other changes, such as quality incentives, quality assurance activities, and risk-sharing arrangements, requires addressing unnecessary segregation in these emerging models in this rule.

As we noted in the Proposed Rule, 87 FR 47873, covered entities designing contracts with MCOs, pharmacy benefit managers, or other third-party entities taking on financial risk for the delivery of health services should carefully scrutinize their capitation, Start Printed Page 37611 reimbursement, quality measurement, and incentive structures to ensure that they do not result in the unjustified segregation of individuals with disabilities or place individuals with disabilities at serious risk of institutionalization or segregation. When responsibility for services is shared across multiple entities, for example, under a managed care contract, both the State Medicaid agency and the contracted entity have obligations under this provision if they are both recipients of Federal financial assistance.

Comment: Many commenters discussed challenges related to mental health services, noting that the lack of available and funded community alternatives to institutional mental health care will continue to result in the institutionalization of individuals with serious mental illness, whether in hospitals, inpatient psychiatric facilities, prisons, or other secure facilities.

Many commenters voiced concern related to discharge planning, as people requiring intensive mental health services are often referred only to institutional or otherwise congregate care options, rather than comparably intensive services in community-based settings. Commenters recommended that OCR clarify that this can constitute a violation of the integration provision if it forces people with psychiatric disabilities to enter segregated settings in order to receive access to adequate services.

Other commenters discussed the disparity in access to community-based care for children who need mental health care.

Response: OCR appreciates the significant concerns related to the availability of community-based behavioral health services, particularly services to address youth mental health. With respect to discharge planning, a hospital or acute care provider that routinely discharges individuals with disabilities, including those with serious mental illness, to nursing homes, psychiatric residential treatment facilities, or other segregated care settings due to discharge planning procedures that do not assess for home-based support services or refer individuals to community-based providers may violate this provision. Covered entities are prohibited from implementing planning, service system design, and service implementation practices that result in the serious risk of institutionalization or segregation.

Comment: Several commenters provided insight into the relationship between community integration and reimbursement rates necessary to sustain a direct care workforce. Commenters explained that individuals receiving care in the community often fail to receive all of the hours of care for which they are approved due to a lack of provider capacity to fully staff the approved hours. Commenters noted that nurse's aides and other individuals who provide assistance in institutional settings are often paid at a higher rate than home health aides and other direct care professionals, resulting in an imbalanced direct care workforce. Commenters emphasized the importance of rate setting to incentivize HCBS.

Response: Reimbursement rates and network adequacy both constitute methods of program administration. As such, these are factors that OCR would consider as reimbursement practices or methods of administration related to this provision.

Comment: Commenters suggested additional guidance clarifying implementation of this provision, including incorporating DOJ's guidance on enforcement of the integration requirement under title II of the ADA describing how to provide the most integrated setting appropriate for an individual or group of individuals; ^[212] addressing the remedies available for violations of the integration provision; and explaining how OCR will undertake a fundamental alteration analysis. One commenter recommended incorporating the fundamental alteration defense into regulatory text. Commenters underscored the importance of setting a high bar for a fundamental alteration, noting that programs must alter an essential aspect of the health program or activity. Other commenters urged OCR to clarify how the fundamental alteration analysis applies to the integration provision, including whether and how OCR will incorporate DOJ guidance and case law related to the ADA's fundamental alteration defense for ADA title II entities. Commenters also requested clarification on whether covered entities will be required to establish an Olmstead integration plan ^[213] to raise the fundamental alteration defense, and if so, guidance related to that requirement.

Commenters also asked OCR to explain in future guidance how covered entities, including Medicaid programs, must coordinate community-based primary care and specialty mental health care and offer case management to avoid discrimination on the basis of disability and to avoid placing individuals with mental disabilities at serious risk of institutionalization.

Commenters further suggested guidance to covered entities explaining the specific HCBS that are essential to achieving compliance with the integration requirement, including as part of EHB. Commenters suggested that it would be discriminatory if EHB plans set higher reimbursement rates for a service or item for individuals in segregated settings rather than community-based settings; if rehabilitation services for physical conditions are covered, but not psychiatric rehabilitation services; and if a particular benefit (such as personal care services) is offered in greater amounts to individuals in segregated settings by virtue of the plan benefit design.

Finally, commenters encouraged OCR to develop joint guidance with DOJ on section 1557, section 504, and titles II, III, and IV of the ADA to ensure the rights of people with disabilities to access community integration in health care settings.

Response: We appreciate the comments requesting clarification through sub-regulatory guidance. We will consider future guidance after this rule has been finalized and are committed to our continued partnership with DOJ in developing shared guidance on civil rights requirements. The availability of the fundamental alteration defense is clear as drafted and so we decline to specifically incorporate this recommendation into regulation text. In this final rule, we clarify that a program is not required to provide coverage for a service in the most integrated setting appropriate to an individual's needs if it would fundamentally alter the program to do so.

Comment: Commenters, primarily representatives of the insurance industry, supported proposed § 92.207(c) that specified nothing in this section requires coverage of any health service where the covered entity has a legitimate, nondiscriminatory reason for determining that such health service fails to meet applicable coverage Start Printed Page 37612 requirements, such as medical necessity requirements, in an individual case. Commenters appreciated that OCR acknowledged that a covered entity's legitimate, nondiscriminatory reason for its actions may serve as a defense under this section.

Some commenters requested clarification that use of the phrase “legitimate, nondiscriminatory reason” not be construed in any way to limit the method of proof for any section 1557 claim to the McDonnell Douglas burden-shifting framework; that this method cannot be used to defend an express sex classification that causes injury; that the familiar but-for causation test applies to establishing a violation of section 1557; and that the McDonnell Douglas burden-shifting framework and legitimate nondiscriminatory reason framework apply to circumstantial evidence cases but not where there is direct evidence of discrimination.

Response: OCR appreciates commenters' support of this provision. As discussed throughout this section and in the Proposed Rule, in instances where there is not a facially discriminatory policy and OCR is investigating whether a particular action or practice is discriminatory under this rule, covered entities have the opportunity to defend the challenged action or practice by providing a legitimate, nondiscriminatory reason for its actions that is not pretext for discrimination. OCR will then evaluate whether the reason given by the covered entity is a pretext for prohibited discrimination. When considering whether a proffered reason is pretextual, OCR will consider, among other things, whether a denial of a health service is based on medical necessity standards or other reasonable medical management techniques that are not discriminatory, as discussed in more detail below.

To provide additional clarity about OCR's analysis when evaluating whether a covered entity's legitimate, nondiscriminatory reason is pretextual, OCR is revising § 92.207(c) to state that a covered entity's denial or limitation of a health service must not be based on unlawful animus or bias, or constitute a pretext for discrimination. This modification is consistent with the revised language in § 92.206(c). Under either section, in instances where there is no evidence of a facially discriminatory policy, covered entities may assert a legitimate, nondiscriminatory basis for actions that could otherwise give rise to the inference of discrimination. Consistent with general principles of civil rights law, OCR will consider such asserted bases but may also investigate to determine whether such asserted bases are pretextual and whether there is evidence that the challenged action was taken because of unlawful animus, bias, or other discriminatory factors.

In evaluating claims of discrimination, OCR relies on general nondiscrimination principles and longstanding civil rights case law. Such principles include, but are not limited to, the multi-factor test articulated in Arlington Heights and the McDonnell Douglas burden-shifting framework, which were discussed in detail in the Proposed Rule at 87 FR 47865. Arlington Heights sets forth a method of proof that utilizes different types of evidence that collectively may demonstrate that a covered entity acted, at least in part, because of a protected basis. The McDonnell Douglas burden-shifting framework is an inferential method of proof used to show that a covered entity treated similarly situated individuals differently because of a protected basis. Under McDonnell Douglas, where non-facial evidence of discrimination exists, a covered entity must articulate a legitimate, nondiscriminatory reason for its actions. The entity's legitimate, nondiscriminatory reason may refute the evidence of discrimination, unless it can be established that this reason is a mere pretext for prohibited discrimination. In response to the commenters' concerns about how § 92.207(c) may be interpreted inconsistently with the principles set forth in McDonnell Douglas and other civil rights principles, please see our response to the same comments under § 92.206 in which we affirm commenters' interpretations are correct— McDonnell Douglas' burden-shifting framework and legitimate nondiscriminatory reason framework apply to circumstantial evidence cases but not in cases where there is direct evidence of discrimination based on a facially discriminatory policy.

Comment: Some commenters appreciated OCR clarifying that medical management techniques based on clinical evidence are permitted, including the use of reasonable medical necessity and utilization management techniques based on clinical standards and evidence-based guidelines, when applied in a neutral manner. Commenters noted that medical management tools provide an important role in promoting quality care and reducing health care costs.

Other commenters raised concerns about medical necessity criteria and other medical management tools, noting that such tools may limit access to needed services and treatment. Commenters noted that discriminatory decisions often occur under the guise of medical necessity determinations. Some commenters argued that medical management practices such as prior authorization, step therapy, and durational or quantity limits are inherently discriminatory and inconsistent with patient health and safety. Many commenters strongly supported OCR clarifying that excessive use or administration of benefit utilization management tools that target particular disabilities could violate section 1557. Commenters asked OCR to expressly note the limitation on the use of utilization management tools in the text of the regulation.

Commenters asked OCR for examples of excessive medical management and suggested the following examples: requiring step therapy for new enrollees who are already on a working course of treatment; transferring management of particular medicines to niche vendors that apply more extensive medical management through specialty carve-out programs; requiring the use of off-label medications within step therapy; and imposing categorical prior authorization and step therapy requirements on most or all drugs required to treat a particular disease. Commenters noted that issuers apply such medical management techniques to discourage individuals with high-cost needs from enrolling in their plans. A commenter cited evidence that plans have restricted access to lower-cost brand drugs and generics when demand for those drugs attracts patients who have overall high health costs.^[214] Other commenters noted that information about treatment limitations can be difficult to find for enrollees and cited evidence of issuers building arbitrary coverage denials into their business plans.^[215] Commenters cited a study that found that more than half of step therapy policies developed by commercial health plans were more Start Printed Page 37613 restrictive than recommended clinical guidelines.^[216]

Some commenters requested that OCR revise the text of § 92.207(c) to state that, in addition to medical necessity requirements, covered entities may employ reasonable medical management techniques.

Response: OCR appreciates the variety of comments and recommendations put forth by commenters related to the rule's coverage of medical management techniques, including medical necessity standards and utilization management techniques.

OCR agrees that revising the regulatory text to reference reasonable medical management techniques would provide clarity and would be consistent with other provisions in the ACA and the Proposed Rule. Therefore, OCR is revising § 92.207(c) to state that applicable coverage requirements include reasonable medical management techniques, including medical necessity.

Further, as stated in the Proposed Rule, covered entities are not prohibited from employing reasonable medical management techniques as long as they are not discriminatory and are not otherwise prohibited under other applicable Federal and State law. 87 FR 47873-74. As just one example, covered entities participating in the Medicaid program under title XIX of the Social Security Act are not prohibited from implementing nondiscriminatory utilization management techniques, such as prior authorization.^[217]

Under § 92.207(c), an issuer may assert a legitimate, nondiscriminatory reason for its denial or limitation of coverage of a health service that asserts the denial was based on medical necessity standards—or any other medical management technique. When assessing whether the challenged action was based on prohibited discrimination rather than on nondiscriminatory medical necessity standards, OCR will review a medical necessity determination only to make sure that it is a bona fide medical judgment, not conduct a review of the medical judgment underlying the medical necessity determination, but rather will assess whether the rationale for the denial was based on impermissible discriminatory considerations. In its review, OCR may require a covered entity to provide the following information: its medical necessity standards or guidelines; the clinical, evidence-based criteria or guidelines ^[218] relied upon to make the medical necessity determination; and the medical substantiation for the medical necessity determination. As discussed previously, OCR will evaluate a covered entity's assertion that its actions were based on legitimate, nondiscriminatory reasons to determine if it is pretextual. Medical necessity determinations that are not based upon general medical judgments or based on clinical, evidence-based criteria or guidelines may be considered evidence of pretext for discrimination.

Similarly, as noted in the Proposed Rule, 87 FR 47872, we affirm that covered entities are not prohibited from using other reasonable medical management techniques, such as utilization management tools, when applied in neutral, nondiscriminatory manner and not otherwise prohibited under other applicable Federal and State law. Utilization management techniques include prior authorization,^[219] step therapy (or “fail-first”),^[220] and durational or quantity limits.^[221]

OCR shares commenters' concerns about potentially discriminatory practices related to medical management techniques and the negative impacts of excessive utilization management. As such, when relying on medical necessity requirements and other medical management techniques to deny coverage for a health service, covered entities must ensure that such tools are developed and applied in a neutral, nondiscriminatory manner. OCR would have concerns about guidelines that establish more restrictive requirements for certain diseases or conditions without a nondiscriminatory justification. In addition, OCR expects that limitations within such guidelines should be applied consistently with clinical standards within each patient population disease state, condition level, and diagnostic category to ensure equal clinical treatment across protected bases. That is, all patients diagnosed with a particular disease state must receive the same treatment that is deemed clinically appropriate, regardless of their race, color, national origin, sex, age, or disability.

We affirm that excessive use or administration of utilization management practices that target a particular condition that could be considered a disability or other prohibited basis under section 1557 could be discriminatory under this rule. OCR declines to state in preamble or regulatory text that specific practices are per se discriminatory under section 1557. As discussed throughout this section, OCR must conduct a fact-specific inquiry into allegations of discriminatory actions and consider a covered entity's proffered reason for the challenged action.

Comment: OCR received a number of comments discussing costs as a legitimate, nondiscriminatory reason for benefit designs under § 92.207(c). Commenters supported the rule allowing clinical evidence to support a benefit design and requested that OCR allow covered entities to use extraordinary costs as justification for certain benefit designs. Commenters stated that covered entities use utilization management controls, such as drug tiering, as part of their benefit design to keep coverage affordable. Commenters noted concerns that high-cost drugs or other services could lead to health plans becoming insolvent if they are unable to apply utilization management controls where all treatments for a particular condition are high cost, particularly when they are expensive new drugs or gene therapies. Commenters argued that issuers and plans must retain some flexibility in their approach to covering and paying for high-cost drugs and services. Commenters expressed concern that § 92.207 would prohibit covered entities from having utilization management controls on all or most drugs or services Start Printed Page 37614 that treat a particular condition or disease, regardless of their cost, and asked OCR to affirm that placing all treatments for a certain disease or condition in one tier may not in fact be discriminatory by default, but rather an appropriate benefit design due to the high cost of those particular items or services.

Conversely, other commenters asked OCR to clarify that covered entities cannot justify benefit designs that disfavor coverage for medically necessary services based on cost savings. Commenters noted that as costs of medications and therapies have increased, covered entities have significantly increased the use of utilization management, including adding arbitrary prior authorization processes not based in clinical evidence for new cancer therapies. They added that rare disease patients face the additional challenge of having no or few treatment alternatives if a preferred medication or therapy is not covered.

Response: OCR reiterates that § 92.207 does not prohibit a covered entity from engaging in reasonable utilization management techniques applied in a neutral, nondiscriminatory manner and that are not otherwise prohibited under other applicable Federal and State law. As noted above, excessive use or administration of utilization management tools that target a particular condition that could be considered a disability or other prohibited basis could violate section 1557. Where there is an alleged discriminatory practice or action that is not based on a facially discriminatory policy, § 92.207(c) provides that the covered entity has the opportunity to provide a legitimate, nondiscriminatory reason for the practice. Covered entities are not restricted in what information they elect to provide to OCR as part of their justification for the challenged practice or action. OCR will carefully review a covered entity's proffered reason to ensure it is not pretext for discrimination.

OCR discussed previously that determinations on whether a particular benefit design feature is discriminatory, such as utilization management or drug tiering, will be made on a case-by-case basis. Accordingly, OCR declines to specify whether certain benefit design practices are per se discriminatory.

Comment: One organization raised concerns that OCR is asserting de facto authority over the relationship between health insurance and medical care, and that OCR is asserting that it has authority under section 1557 to regulate the practice of medicine and the structure of health insurance coverage according to its own determination of what is “appropriate” and “nondiscriminatory,” along with the authority to definitively determine what is, or is not, the current standard of medical care. The commenter further states that OCR may in the future assert and exercise similar claims of authority with respect to other medical practices, standards of care, or health insurance coverages.

Response: As previously discussed throughout this preamble, section 1557 was intended to prohibit discrimination in health insurance coverage and other health-related coverage, as the statute's plaint text makes apparent. Congress expressly granted the Secretary the authority to promulgate regulations to implement section 1557. 42 U.S.C. 18116(c). Therefore, OCR is acting within its statutory authority in promulgating this final rule to regulate health insurance coverage or other health-related coverage provided or administered by a recipient health insurance issuer or other covered entity. OCR disagrees with the commenter that this rule establishes a standard of medical care, or requires certain health insurance coverages. As specified in the preceding discussion, when assessing whether a challenged action was based on prohibited discrimination rather than on nondiscriminatory medical necessity standards, OCR will not conduct a general review of the medical judgment underlying the medical necessity determination, but rather will assess whether there is facial or other direct evidence of discriminatory intent or if a proffered rationale for the denial was pretext for discrimination. Further, this final rule does not require coverage of a particular health service; rather, it requires that the coverage being offered must be provided in a neutral and nondiscriminatory manner.

Comment: Commenters stated that issuers should provide transparent information on coverage details, utilization management practices, denial rates, and reasons for denials. Specifically, a commenter requested that this section be strengthened by implementing a requirement for health plans to disclose medical necessity determinations when care or coverage is denied based on medical necessity to individual enrollees. The commenter further suggested that OCR adopt the approach in the MHPAEA final rule, requiring disclosure of medical necessity criteria to potential beneficiaries or enrollees and the reasons behind denials of coverage or reimbursement. Commenters emphasized that disclosure would help providers and consumers to identify and challenge discriminatory denials of medically necessary care, which can be difficult to do when data regarding the coverage they need either does not exist or the issuer holds the data on details of coverage, denial rates, and reasons for denial.

Response: OCR agrees with commenters that transparency about medical management policies and coverage determinations and denials is useful information for the public, and we encourage issuers to disclose such information to all enrollees. OCR considered requiring issuers to affirmatively disclose certain plan information to the public, but we decline to do so at this time. We have determined that placing a transparency requirement on health insurance issuers covered under section 1557 would not be helpful on issuers if required in every situation, and because the scope and application of section 1557 is broader than, and imposes different requirements from, MHPAEA. We stress that OCR has the authority to request and receive information from a covered entity on the details of coverage, medical management policies, denial rates, and reasons for denials, among other things, when necessary to determine compliance with section 1557.^[222] In addition, we note that appeals processes that subject individuals protected by section 1557 to excessive administrative burdens in accessing coverage benefits that other enrollees are not required to navigate when accessing coverage may be discriminatory under section 1557.

Comment: OCR received many comments on the use of value assessment methods in benefit design and pricing and coverage decisions, and their impacts on treatments for people with disabilities and older adults, particularly in access to prescription drugs and benefit design. Commenters suggested that some payers use these assessment methods to steer patients away from newer or more innovative treatments to less effective options. Commenters on this issue appreciated OCR's recognition in the Proposed Rule that these methods can have discriminatory impacts, though commenters did not provide uniform input about how to address these impacts.

Several commenters called for increased oversight of value assessment methods by OCR, and some called on OCR to ban the use of the quality- Start Printed Page 37615 adjusted life year (QALY) framework and similar methods. Commenters supporting a ban on the use of QALYs stated that these methods are inherently discriminatory because they assign a lesser numerical value to extending the lives of people with disabilities and older adults compared to people without disabilities or younger persons, especially when applied to benefit design or access to prescription drugs.^[223]

Response: OCR recognizes that value assessment methods can be helpful tools in making decisions in various contexts within health care and are used widely. The use of value assessment methods that result in discrimination on the basis of race, color, national origin, age, disability and sex are prohibited under section 1557's general mandate of nondiscrimination. That is, where a value assessment uses methods that penalize patients or groups of patients on a ground protected by section 1557 and where such methods then result in limiting access to an aid, benefit, or service, they may violate section 1557. In response to commenters, we note that value assessment tools cannot be used to, to deny or afford an unequal opportunity to qualified individuals with disabilities or on the basis of age with respect to the eligibility or referral for, or provision or withdrawal of any aid, benefit, or service, including the terms or conditions under which they are made available. We further note that methods of value assessment are permissible so long as they do not discriminate in discounting the per-year value of life extension on the basis of age or disability under section 1557.

In addition, OCR has proposed a prohibition against the discriminatory use of value assessment methods in pending rulemaking under section 504. 88 FR 63409. Proposed § 84.57, which applies to recipients of Federal financial assistance from HHS, prohibits, directly or through contractual, licensing, or other arrangements, using any measure, assessment, or tool that discounts the value of life extension on the basis of disability to deny or afford an unequal opportunity to qualified individuals with disabilities with respect to the eligibility or referral for, or provision or withdrawal of any aid, benefit, or service, including the terms or conditions under which they are made available.

Given that many different measures exist for use in value assessment and may be applied in different ways, this discussion applies to evaluating any value assessment methodology rather than commenting on specific measures at this time. However, we appreciate the concerns raised by the commenters and will take them into account as OCR proceeds with future work on value assessment.

Comment: Many comments on value assessment also requested further development of new value assessment measures and the incorporation of input from patients with disabilities (and, per some commenters, their family members and providers) into value assessment schema. Commenters urged the Department to support the development and dissemination of these methodologies. Another commenter noted that cultural barriers existed in institutions that prevented the adoption of new metrics.

Response: OCR appreciates commenters' input and encourages and supports the development of such metrics and the incorporation of input from people with disabilities and other interested groups protected under section 1557, as reflected in research priorities elsewhere in the Department. Numerous research and grantmaking initiatives from the National Institutes of Health (NIH) and the National Institute on Disability, Independent Living, and Rehabilitation Research (NIDILRR) support this and similar efforts.^[224] In addition, OCR notes that the National Council on Disability issued an updated policy brief released in November 2022.^[225]

Benefit Design Analysis

The comments and our responses regarding benefit design are set forth below.

In the Proposed Rule, we discussed that OCR will apply basic nondiscrimination principles to the facts of the particular plan or coverage when analyzing allegations of discrimination under this section to determine if the challenged action is unlawful. We discussed that, consistent with general principles in civil rights law, covered entities will have the opportunity to articulate a legitimate, nondiscriminatory justification for an alleged discriminatory action or practice, and that OCR will scrutinize the justification to ensure it is not a pretext for discrimination.

Comment: Some commenters requested that OCR provide additional guidance explaining how it intends to investigate potential violations by health programs or activities engaged in providing or administering health insurance coverage or other health-related coverage and to ensure ongoing compliance with Federal law. Commenters urged OCR to establish clear, predictable standards that covered entities can rely upon when designing their plans and that will ensure OCR's “case-by-case” analysis does not result in only retroactive reviews of existing plans or lead to arbitrary results.

Another commenter noted that if OCR will not provide presumptively discriminatory benefit design examples, OCR should provide more information to educate covered entities about what OCR interprets to be best practices other than the information, corrective plans, and resolution agreements it stated it would publish on its website in the 2016 Rule. The commenter urged OCR to publicly publish deidentified information on each and every investigation that it pursues, including the specific actions purported to be discriminatory by a covered entity, the alleged basis of discrimination, and OCR's resolution of the complaint so that covered entities can educate themselves on best practices and actions that OCR may deem to be discriminatory.

Response: We appreciate the comments requesting further specificity regarding OCR's analysis when investigating potential violations under this section. We agree that providing clarity to covered entities promotes compliance and reduces prohibited discrimination. Each potentially discriminatory action involves unique Start Printed Page 37616 facts and circumstances that must be independently investigated on a case-by-case basis before OCR can determine whether a challenged action is considered discriminatory under this section, particularly considering that each covered entity's reason for engaging in the challenged action may be specific to that covered entity and the circumstances surrounding its decision process. For example, when determining whether a challenged design feature is discriminatory, OCR considers the benefit design of the plan as a whole, whether similar limitations or restrictions are placed on other types of health services, and whether the covered entity consistently relies on neutral, nondiscriminatory criteria when developing the design feature, among other things. Therefore, OCR reaffirms the investigative approach set forth in the Proposed Rule, 87 FR 47875, whereby OCR's determination of whether a challenged action is discriminatory is necessarily a fact-specific, case-by-case analysis dependent on the facts of the particular situation. When analyzing whether an action violates this section, OCR will apply basic nondiscrimination principles to the facts of the particular health insurance coverage or other health related coverage, consistent with civil rights case law. This includes the opportunity for covered entities to articulate a legitimate, nondiscriminatory justification for an alleged discriminatory action, which OCR will scrutinize to ensure it is not a pretext for discrimination. Where a covered entity's justification relies upon medical standards or guidelines, we note that such standards or guidelines may be subject to additional scrutiny if they are not based on clinical, evidence-based criteria or guidelines. For more information related to OCR's consideration of a covered entity's legitimate, nondiscriminatory reason, please see previous discussion under § 92.207(c).

OCR reiterates that this rule does not require a covered entity to provide coverage for any particular health service in its health insurance coverage or other health-related coverage when provided in a nondiscriminatory manner; however, to the extent a covered entity provides coverage for a particular health service, the covered entity must provide the health service to all individuals in a neutral, nondiscriminatory manner consistent with this rule.

Regarding our analysis when investigating potential discrimination in the benefit design of excepted benefits and short-term, limited duration insurance (STLDI), we provide additional information below in the discussion under this section on Scope of Application to Health Insurance and Health-Related Coverage (Including Excepted Benefits and STLDI).

OCR acknowledges that the nature of our complaint-driven investigative process results in OCR reviewing existing plans and making determinations on the benefit designs of existing plans. However, OCR's case-by-case analysis is necessary in order to consider the fact-specific nature of each challenged action and to apply relevant case law to each situation. OCR investigates each allegation in a consistent manner and treats all complainants and covered entities evenly.

We appreciate commenters' suggestions to provide more information to educate covered entities about what OCR interprets to be best practices; OCR will consider issuing such guidance in the future. To educate both the public and covered entities, OCR posts its resolution agreements on its website and issues press releases when cases are resolved, and we intend to continue this practice.

Comment: Commenters recommended that OCR specify in the final rule that a nondiscriminatory benefit design is one that is clinically based. While expressing support for OCR considering clinical guidelines and standards of care when evaluating plan benefit designs, these same commenters also cautioned that OCR should not exclusively rely on clinical guidelines and journal articles in its analysis of discriminatory design because clinical guidelines may perpetuate racial bias and health disparities, and entities could cite a single peer-reviewed article as a shield to escape valid claims of discriminatory benefit design.

Response: An analysis of whether a benefit design is discriminatory under this rule is a fact-specific inquiry that will be made in accordance with general civil rights principles and applicable case law. As discussed under § 92.207(c), covered entities may provide a legitimate, nondiscriminatory reason as a defense to a potentially discriminatory coverage determination. A covered entity has latitude to submit any legitimate reason for its actions as long as it is not discriminatory or pretext for discrimination. However, if the justification given is not based on clinical, evidence-based criteria or guidelines, OCR will consider that evidence of pretext. When a covered entity submits a justification that relies upon medical standards or guidelines, OCR may conduct additional investigation to ensure the justification is not pretextual, including a review on whether the standards or guidelines are or are not based on clinical, evidence-based criteria or guidelines. OCR's review of a covered entity's justification will not rely solely on a covered entity's provision of one piece of literature but will consider a variety of factors, as discussed in detail above under §§ 92.206(c) and 92.207(c). We further note that OCR will not conduct a general medical review of the medical judgment undergirding the determination.

Comment: Commenters noted that OCR could ensure higher quality health care for all enrollees through stronger oversight and regulation. These commenters urged OCR not to rely solely on complaints and to engage in proactive oversight by affirmatively reviewing covered entities' plan designs.

Response: We agree that robust enforcement of section 1557 is critical to ensure individuals' ability to receive medically necessary health services, unencumbered by discriminatory conduct. OCR will employ all available means of investigating health insurance coverage and other health-related coverage under this rule, including through compliance reviews and complaint investigations.

Comment: Commenters requested that OCR clarify how it will coordinate with State and Federal agencies that establish specific plan requirements and approval processes. Commenters noted that many facets of benefit design are heavily regulated by other agencies within the Department, including CMS' regulation of nondiscriminatory plan design in EHB and qualified health plans, retail pharmacy network adequacy of Medicare Part D plans, and benefit coverage requirements under Medicare Advantage and Medicaid. Commenters suggested that OCR should not enforce a discrimination claim if the underlying design is accepted by the plan's regulator and should defer enforcement action to existing review processes where appropriate. Some commenters also suggested that the Department should establish a safe harbor for health insurance issuers to comply with section 1557 in cases where there are State law interactions to avoid creating multiple or duplicative standards.

Response: OCR acknowledges commenters' concerns about harmonization in the regulation and enforcement of benefit design requirements across State and Federal laws. We note that covered entities offering health insurance coverage and other health-related coverage, such Start Printed Page 37617 Medicaid or qualified health plans in the Exchanges, are subject to a host of other laws and regulations, at both the State and Federal level. OCR does not view a covered entity's compliance with other State or Federal laws, which were adopted under different requirements and for different purposes, to be determinative in all cases of a covered entity's compliance with section 1557, unless otherwise specified in this rule.^[226] OCR commits to coordinating with other Federal agencies as appropriate to avoid inconsistency and duplication in enforcement efforts and will consider issuing guidance in coordination with other agencies, such as CMS, after publication of the rule. We will give consideration to a covered entity's compliance with other Federal laws when those requirements overlap with section 1557's requirements and will work closely with covered entities when compliance with this final rule requires additional action. That said, as the lead enforcement agency for section 1557, OCR maintains sole authority to determine a covered entity's compliance with this final rule.

Comment: Commenters requested clarity on which covered entity is liable for potentially discriminatory plan benefit designs when several covered entities provide or administer elements of the benefit design. Commenters requested that OCR state that all entities, including third party administrators, benefits advisers, and consultants, that participate in discriminatory plan design with respect to group or individual insurance plans are covered entities under section 1557. A commenter requested that benefits advisers or consultants working with employers to design self-funded group health plans specifically should be considered a covered entity presumptively where the employer, the plan, or the third party administrator receives Federal financial assistance. The commenter noted concern that such advisers and consultants are a driving force behind discriminatory plan design and should be put on notice that their conduct is subject to section 1557 in many circumstances. A commenter requested that OCR make clear that any entity itself covered by section 1557 violates the statute by outsourcing the implementation or design of discriminatory plans to entities that might themselves not be covered by the statute.

Response: OCR clarifies that in situations where multiple covered entities provide or administer elements of a discriminatory benefit design, all of the entities may be found liable under section 1557. In the discussion of the definition of “Federal financial assistance” in § 92.4, we explained that both the direct recipient and subrecipient (or subcontractor) are responsible for complying with applicable civil rights laws. We also note that covered entities are responsible for the conduct of their subcontractors and cannot outsource or contract away their civil rights obligations by entering into contractual arrangements with subcontractors. The responsibility of third party administrators is discussed later in this section. As noted, this final rule does not apply to employment practices. See § 92.2(b).

Comment: Commenters expressed concern that the proposed regulation may unintentionally limit covered entities' ability to develop effective programs and initiatives to close care gaps and address unique needs to reduce health disparities. Commenters explained that they currently conduct individual outreach to members of a subgroup through care management processes, invest in social determinants of health interventions, tailor marketing to subgroups to address particular health concerns, provide plans that restrict enrollment to special needs individuals with specific chronic conditions, and develop targeted quality programs and chronic care management programs to reduce health disparities for their members. A commenter noted that issuers take those actions to more efficiently provide care to particularly vulnerable populations without an intent to discriminate. Another commenter noted that if health plans are required to provide services that address chronic care, social determinants of care, or other similar programs “equally” to all enrollees rather than “equitably” target services to those in need based on health or socioeconomic condition, plans will be limited in their ability to provide appropriate services and scale and sustain these programs. To address these concerns, commenters requested that OCR clarify in the final rule that actions taken to reduce health disparities and those designed to improve health for specific populations are not discriminatory for purposes of section 1557. Commenters also recommended that OCR consider an approach similar to language in the Department's Group Health Insurance Market regulations prohibiting prohibition on discrimination based on health status that explicitly permits group health plans and health insurance issuers to treat individuals with adverse health conditions more favorably. 45 CFR 146.121(g).^[227]

Response: We appreciate commenters raising this concern and applaud efforts to mitigate and address health disparities. Nothing in this rule prohibits programs designed to improve health outcomes for specific populations so long as the programs do not discriminate on the basis of race, color, national origin, age, sex, or disability. For example, programs could be developed using social determinants of health or other metrics that serve to identify underrepresented individuals that are not based on protected bases under section 1557. To illustrate, a “Special Needs Plan” is a specialized Medicare Advantage coordinated care plan that exclusively enrolls “special needs individuals,” who are not limited to individuals with disabilities, and do not violate section 1557.^[228] In addition, covered entities are permitted and encouraged to develop programs that address health disparities related to a person's age. Under the Age Act and section 1557, age distinctions in programs that provide special benefits to older adults or children are permitted. 45 CFR 91.17 (Age Act); 92.101(b)(1) (section 1557, incorporating 45 CFR 91.17).

Scope of Application to Health Insurance Coverage and Other Health-Related Coverage (Including Excepted Benefits and STLDI)

In the 2022 NPRM, we sought comment on excepted benefits and short-term, limited-duration health insurance (STLDI), and the Proposed Rule's application to these products. Consistent with the definition of “health program or activity” under § 92.4, we proposed that the rule would apply to all the operations of any covered entity principally engaged in the provision or administration of health insurance coverage or other health-related coverage. 87 FR 47875-76.^[229] As an example, we explained that an issuer participating in the Exchange and thereby receiving Federal financial assistance would be covered by the rule for its qualified health plans offered on the Exchange, as well as for its health Start Printed Page 37618 plans offered outside the Exchange, including, for example, large group market plans,^[230] grandfathered plans,^[231] grandmothered plans,^[232] excepted benefits,^[233] and STLDI,^[234] as well as for its operations related to acting as a third party administrator for self-insured group health plans. 87 FR 47876.

The comments and our responses regarding the scope and application to all operations of a covered health insurance issuer and to excepted benefits and STLDI specifically are set forth below.

Comment: Several commenters, including those representing the health insurance industry and some State insurance regulators, raised concerns about how the Proposed Rule's application to all operations of a recipient health insurance issuer would result in covering an issuer's other operations and lines of business that do not receive Federal financial assistance, including, for example, plans sold off the Exchange, grandfathered plans, grandmothered plans, employer plans, excepted benefits, STLDI, third party administrator activities and pharmacy benefit manager activities. Commenters noted that these plans are treated separately under the ACA and are not subject to some or all of the ACA's health insurance market reforms. Commenters suggested that plans that do not receive Federal financial assistance should not be subject to section 1557. Comments about particular types of plans are discussed in turn below.

Commenters argued the Proposed Rule's application was too broad and went beyond Congressional intent and urged OCR to retain the 2020 Rule's approach that the rule cover a health insurance issuer's operations only to the extent the operations directly receive Federal financial assistance.

In addition, commenters argued that applying the rule to a covered issuer's operations that do not receive Federal financial assistance would create an unlevel playing field among health insurance issuers that accept Federal funding and those that do not, placing those that receive Federal funding at a competitive disadvantage. For example, commenters stated that issuers that do not receive Federal financial assistance may underwrite excepted benefits or STLDI by age or sex, or exclude higher cost health care services, which may result in non-covered entities offering lower-cost coverage to a pool of individuals whose coverage is less costly, while the pool of individuals under a covered entity's coverage could be costlier, leading to higher premiums. Commenters also argued that covered entities would be subject to increased compliance costs to which competitors are not subject. For example, these commenters stated that compliance with the rule's nondiscrimination notices would result in tremendous costs to which non-covered entities are not subject. Some commenters argued that this competitive disadvantage could discourage issuers from participating in the Exchanges.

A few commenters that supported the proposed application to all an issuer's operations also raised concerns that the rule would create an unlevel playing field that would disadvantage plans that support Federal programs like Medicare and Medicaid while giving an unfair competitive advantage to competitors that are not required to comply with nondiscrimination requirements. To level the playing field, these commenters and others suggested that OCR work with other Federal agencies and develop a tri-Department rule with the Departments of Labor and the Treasury to subject all health plans to similar nondiscrimination and accessibility requirements.

A number of commenters, including some members of Congress, supported the broad application of the rule to an issuer's other operations and argued the 2020 Rule's approach is contrary to Congress's intent in passing the ACA to prohibit discrimination in health care. Commenters argued that a private insurance company receiving financial assistance from the Federal Government should not be allowed to engage in discriminatory practices in its other lines of business. Commenters observed that issuers offering plans that receive Federal financial assistance, such as qualified health plans or Medicare Advantage plans, often also offer plans that do not receive Federal financial assistance. Noting that many of these other types of plans are not currently subject to any or all nondiscrimination requirements under the ACA's health insurance market reforms, these commenters argued that the Proposed Rule's broad application will increase protections from discriminatory practices for individuals enrolled in those plans.

Response: OCR appreciates the concerns raised by some commenters regarding the Proposed Rule's application to all operations of a recipient health insurance issuer; however, these concerns do not abrogate a recipient's obligation to comply with section 1557. Under the definition of “health program or activity” at § 92.4, a recipient of Federal financial assistance that is principally engaged in the provision or administration of health insurance coverage or other health-related coverage is covered under this rule for all of its operations. Section 1557 applies to “any health program or activity, any part of which is receiving Federal financial assistance,” 42 U.S.C. 18116(a) (emphasis added). As we explain in detail under the discussion of the definition of “health program or activity” in § 92.4, it is reasonable to infer that Congress intended the term “health program or activity” to be interpreted broadly and to include all of that entity's operations if the entity that receives Federal funding is principally engaged in the provision or administration of health insurance coverage or other health-related coverage.^[235]

Start Printed Page 37619

In response to comments that this obligation might cause a competitive disadvantage with entities that do not accept Federal funds, this obligation is consistent with statutory text as set forth by Congress, as discussed above. Further, the risk of competitive disadvantage is low given that the majority of health insurance issuers offer some type of product that receives Federal financial assistance, such as Medicare Advantage plans, Medicare Part D prescription drug plans, Medicaid managed care plans, and qualified health plans through the Exchanges.^[236] In any event, by accepting the benefit of Federal funds, a recipient is prohibited from discriminating in its health programs and activities under section 1557, as discussed previously under the definition of “health program or activity.” Any recipient of Federal financial assistance from the Department is subject to this same requirement and prohibited from discriminating in its health programs and activities, including all of its operations when principally engaged, as set forth in this final rule.

Section 1557 does not authorize OCR to require a health plan or insurance issuer not otherwise subject to section 1557 to comply with the statute. Whether the Department could issue a rule, under different authority, with the Departments of Labor and the Treasury, to apply similar nondiscrimination and accessibility standards to all health plans or health insurance issuers, is outside the scope of this rule.

We further address comments about particular types of plans and their coverage under this final rule in various comment responses below.

Comment: Some commenters requested that grandfathered and grandmothered plans should be exempt from the rule because they are not subject to many of the ACA's provisions. These plans benefit consumers, commenters stated, by allowing them to maintain affordable existing coverage as long as it continues to meet their needs. Commenters argued that applying section 1557 to these plans would be inconsistent with the longstanding regulatory treatment of the plans. Further, commenters argued that the costs of complying with section 1557, including but not limited to notice and tagline requirements, could result in increased costs for issuers, which would be passed on to consumers, and could lead to a decision to discontinue plans.

Response: OCR understands commenters' concerns and acknowledges that grandfathered and grandmothered plans are not subject to many of the ACA's provisions. However, the statutory text of the grandfathered health plan provision ^[237] indicates that Congress did not intend to exclude them from dection 1557. The statute sets forth the specific provisions of the PHS Act that apply to grandfathered plans and then provides that except for those provisions, “this subtitle and subtitle A (and the amendments made by such subtitles) shall not apply” to grandfathered plans. 42 U.S.C. 18011(a)(2). “This subtitle” refers to subtitle C of title I of the ACA, while “subtitle A” refers to subtitle A of title I of the ACA, both of which contain market reforms. Section 1557 is in subtitle G of title I of the ACA and therefore is not one of the subtitles that Congress specified should not apply to grandfathered health plans.

Grandmothered plans ^[238] were not established in the ACA or the PHS Act; they are not exempt from the ACA or the PHS Act by statute or regulation. Rather, CMS specified that it will not take enforcement actions against grandmothered plans that are out of out of compliance with certain specified ACA market reforms under certain conditions (CMS Non-Enforcement Policy).^[239] The CMS Non-Enforcement Policy has been in place since 2013 ^[240] and has provided relief from the same ACA market reform provisions continuously since that time.^[241] Section 1557 has never been one of the provisions for which enforcement relief was provided; therefore, grandmothered plans are not exempt from section 1557.

When offered by a recipient health insurance issuer, grandfathered and grandmothered plans would be covered under the rule as part of the issuer's operations when the issuer is principally engaged in the business of providing or administering health insurance coverage or other health-related coverage. If OCR were to receive a complaint about a grandfathered plan or grandmothered plan, OCR would carefully consider the facts and circumstances of the challenged action or practice. As discussed throughout this section, the health insurance issuer may provide a legitimate, nondiscriminatory reason for the action or practice. Further, in cases of alleged disability discrimination, covered entities may also prove that modifying a plan to comply with section 1557 would result in a fundamental alteration to their health program or activity.

Comment: A commenter requested clarification on how the rule would apply to Medicare Employer Group Waiver Plan (EGWP) participants.

Response: EGWPs are types of Medicare Part C (Medicare Advantage) plans ^[242] or Medicare Part D prescription drug plans ^[243] that qualify for waivers of certain Medicare regulations because they are offered exclusively to the employees, former employees, members or former members of an employer, union or labor organization, or the trustees of a fund established by one or more employers or labor organizations (or combination thereof). Entities that receive funding through the Department's Medicare Part C or Medicare Part D program are subject to the rule as recipients of Federal financial assistance. This includes entities providing Medicare Start Printed Page 37620 Advantage plans or Medicare Part D plans, including EGWPs, or qualified retiree prescription drug plans (as defined at 42 CFR 423.882) (also known as RDS plans). Because employers and other plan sponsors are not subject to this rule with regard to their employment practices, pursuant to § 92.2(b), an employer or other plan sponsor would not be liable for discrimination related to these plans under this rule. This applies even if an employer directly contracts with CMS to offer a Medicare Advantage or Part D plan as an EGWP and receives Federal financial assistance for that EGWP.^[244] In circumstances where an employer offers an “800 series” EGWP through a Medicare Advantage organization or Part D plan sponsor,^[245] the health insurance issuer or entity offering the EGWP would be subject to the rule for the EGWP plan due to receipt of either Medicare Part C or Part D funding.

Comment: One commenter requested clarification as to whether self-funded non-Federal Governmental plans, such as municipal plans, that opt out of certain Federal market reforms are covered under this rule if they receive funds from the Department directly or indirectly.

Response: A self-funded non-Federal Governmental plan is a governmental plan established or maintained by a non-Federal Governmental agency, such as a State, county, school district, or municipality, for its employees.^[246] As with any other type of group health plan coverage, a non-Federal Governmental plan would be subject to this rule if it directly or indirectly receives Federal financial assistance from the Department. The non-Federal Governmental agency sponsoring the employee health benefit plan would be excluded from liability under this rule an employer or plan sponsor, as applicable, pursuant to § 92.2(b).

Comment: Commenters requested that the rule clarify when group health plans are subject to the rule.

Response: A group health plan is subject to this rule if it is a recipient (or subrecipient) of Federal financial assistance as set forth under § 92.2(a)(1). We address the rule's applicability to group health plans in more detail in the discussion above under §§ 92.1 (Applicability) and 92.4 (definition of “health program or activity”).

Comment: Several commenters expressed concerns with the rule's proposed application to excepted benefits as part of a covered health insurance issuer's operations and urged OCR to exclude excepted benefits from the rule. Commenters argued that the rule's coverage of excepted benefits is inconsistent with Congressional intent and likely subject to legal challenge. These commenters explained that excepted benefits are statutorily defined benefits that Congress has long recognized as distinct from traditional health insurance coverage by excluding them from health insurance and group health plan coverage mandates under the PHS Act, ERISA, and the Internal Revenue Code, as long as they meet certain requirements.^[247] Commenters argued that the ACA retained this exclusion and that Congress therefore intended excepted benefits to be excluded from the ACA. To further demonstrate Congressional intent to exclude excepted benefits, commenters stated that since Congress first recognized excepted benefits in 1996 as part of HIPAA by incorporating their provisions into the PHS Act, ERISA, and the Internal Revenue Code, Congress has had several opportunities to redefine excepted benefits or to impose new requirements on them in subsequent laws, including the ACA, but it has not chosen to do so.^[248]

While acknowledging that section 1557 does not explicitly exclude excepted benefits, commenters asserted that OCR cannot use its regulatory authority to impose new requirements that are inconsistent with the carefully crafted statutory provisions governing excepted benefits where Congress has clearly chosen not to do so. As support, commenters cited to Central United Life v. Burwell, 827 F.3d 70 (D.C. Cir. 2016). Commenters stated the court in Central United struck down a Department rule that revised the requirements related to fixed indemnity excepted benefit insurance in the individual market as an unconstitutional exercise of regulatory authority because the ACA maintained the HIPAA excepted benefit exemption for these benefits and the law did not authorize the Department's proposed requirement. Central United, commenters argued, illustrates that nothing in the ACA changes the excepted benefits governing statutes and demonstrates that agencies must adhere to the boundaries set forth in Federal statute.

Commenters stated that the ACA is entirely focused on comprehensive medical coverage, while excepted benefits are not intended to serve as such coverage. They maintained that excepted benefits are not used to finance the delivery of health care services but are meant to provide benefits for a wide variety of costs associated with accidents or illnesses not covered by comprehensive medical insurance, or to defray costs that are not fully covered by comprehensive medical coverage. For example, commenters stated that some of these products, such as dental and vision plans and Medicare supplemental insurance (Medigap), can cover additional benefits not included in comprehensive medical plans. Commenters stated that noncoordinated excepted benefits, such as fixed indemnity excepted benefits and specified disease excepted benefits coverage, must pay benefits regardless of whether the medical event triggering benefits is covered under another plan. Commenters stated that while comprehensive medical insurance coverage is regulated through HIPAA or the ACA, excepted benefits are subject to separate long-standing and extensive State regulatory regimes whereby Congress and State policymakers have consistently maintained excepted benefits are not meant to be a type of comprehensive health insurance that pays for medical benefits, and therefore, commenters argue, should not be within the purview of the ACA, including section 1557.

Commenters further expressed concerns that applying the rule to excepted benefits could severely disrupt the market for these benefits and may drive competitors out of the market, Start Printed Page 37621 ultimately increasing health care costs and premiums and reducing product choice for consumers and employers, and thereby reducing access to care. Commenters also asserted that applying the rule to excepted benefits could result in increased costs that are passed onto consumers as increased premiums, which could result in individuals dropping coverage due to lack of affordability and thereby result in reducing access to care, particularly in dental plans where consumers are highly price sensitive when selecting coverage.

Conversely, many other commenters supported applying the rule to excepted benefits as part of an issuer's operations. Commenters noted that excepted benefits are under-regulated and not otherwise subject to nondiscrimination requirements. Commenters argued this would provide comprehensive nondiscrimination protections for individuals enrolled in excepted benefits, particularly individuals with disabilities who face barriers to accessing care.

Response: OCR appreciates the breadth of comments received and the concerns raised. Excepted benefits are statutorily defined benefits that are exempt from the Federal consumer protection and market reforms applicable to comprehensive coverage under title XXVII of the PHS Act, part 7 of ERISA, and Chapter 100 of the Internal Revenue Code (hereinafter the Federal consumer protections and market reform requirements applicable to comprehensive coverage). Some excepted benefits are exempt from the Federal consumer protection and market reform requirements applicable to comprehensive coverage in all circumstances, such as coverage only for accident, workers' compensation or similar coverage, disability income coverage, and coverage for on-site medical clinics. 42 U.S.C. 300gg-21(b), 300gg-63(a), and 300gg-91(c)(1).

Other types of coverage, known as limited excepted benefits, are exempt from the Federal consumer protection and market reform requirements applicable to comprehensive coverage when the benefits are offered under a separate policy, certificate or contract of insurance, or are otherwise not an integral part of the plan. 42 U.S.C. 300gg-21(c)(1), 300gg-63(b), and 300gg-91(c)(2). Examples of limited excepted benefits include certain limited scope vision insurance and limited scope dental insurance (though stand-alone dental plans sold through the Exchange are subject to certain qualified health plan requirements),^[249] and long term care insurance.

Another type of coverage, known as independent, noncoordinated excepted benefits, are exempt from the Federal consumer protection and market reform requirements applicable to comprehensive coverage when certain conditions are met. 42 U.S.C. 300gg-21(c)(2), 300gg-63(b), and 300gg-91(c)(3). This category of excepted benefits includes coverage only for a specified disease or illness (such as cancer-only policies) and hospital indemnity or other fixed indemnity insurance.

The final type of excepted benefit coverage is supplemental excepted benefits. Benefits are supplemental excepted benefits only if they are provided under a separate policy, certificate, or contract of insurance and are Medicare supplemental health insurance (also known as “Medigap”), coverage supplemental to the coverage provided under 10 U.S.C. chapter 55 (also known as TRICARE supplemental programs), or similar supplemental coverage provided to coverage under a group health plan. 42 U.S.C. 300gg-21(c)(3), 300gg-63(b), and 300gg-91(c)(4).

Excepted benefits offer more limited coverage than, and are generally not intended to be an alternative to or replacement for, comprehensive coverage. These products are not subject to the Federal consumer protections and market reform requirements applicable to comprehensive coverage when applicable criteria are met. As we stated in the 2016 Rule, 81 FR 31431, and the 2022 NPRM, 87 FR 47875, and restate here, the fact that excepted benefits are exempt from the Federal consumer protections and market reform requirements applicable to comprehensive coverage, including the ACA's consumer protections and market reforms, and are not intended to serve as comprehensive coverage does not justify their exclusion from section 1557.^[250] In addition, section 1557 does not limit its protections only to health programs and activities that are themselves subject to other provisions of the ACA or that are comprehensive coverage, but also applies to all operations of any covered entity that is principally engaged, as defined under the term “health program or activity” in § 92.4. Further, section 1557 is an independent provision, which Congress did not codify in the PHS Act or co-locate in the ACA with the ACA's market reforms. Further, section 1557 uses the broad term “health program or activity,” in contrast to elsewhere in the ACA where Congress specifically made distinctions between various types of insurance. If Congress had intended to limit section 1557's reach to only certain types of insurance in the PHS Act or to carve out excepted benefits from the scope of section 1557, it could have done so.

OCR is mindful of comments raised about potential market disruption and reduced health care options for the public. However, as we discussed previously in the definition of “health program or activity” under § 92.4, commenters did not provide sufficient evidence to support this contention. Further, we note that when OCR has determined that a particular plan is discriminatory under this final rule, a covered entity may provide a legitimate, nondiscriminatory reason for the plan's benefit design. This could include evidence that compliance with § 92.207 would result in making the plan unaffordable to the extent the covered entity could no longer offer the plan. When such a reason is proffered, OCR will carefully consider the evidence presented by the covered entity in making our determination as to whether the reason is legitimate and not pretext for discrimination. In the case of alleged disability discrimination, covered entities may also prove that modifying a plan to comply with section 1557 would result in a fundamental alteration to their health program or activity.

For these reasons, we are not excluding excepted benefits from requirements established in this final rule. If a recipient health insurance issuer is principally engaged in the provision or administration of health insurance coverage or other health-related coverage, all of its operations are covered, including its provision of excepted benefits. Further, we note that a principally engaged issuer would not be covered under this rule for its excepted benefits subsidiary if the issuer can prove that the subsidiary is legally separate from its federally funded activities.^[251]

Commenters' reliance on Central United to argue that this rule exceeds OCR's regulatory authority by imposing new requirements that are inconsistent Start Printed Page 37622 with statutory provisions regarding excepted benefits is misplaced. In Central United, the court invalidated the requirement at 45 CFR 148.220(b)(4)(i) that an individual must attest to having minimum essential coverage prior to purchasing fixed indemnity excepted benefits coverage in the individual market. The court held that imposing that requirement went beyond what Congress required under the PHS Act. 827 F.3d at 74. The PHS Act statutes at issue in Central United contain statutory language specifically addressing excepted benefits, while section 1557 does not expressly mention or address excepted benefits. Further, Congress could have but did not extend the exemption under the PHS Act for these products to section 1557.^[252] OCR therefore maintains that this rule's interpretation and application to all operations of a recipient health insurance issuer when principally engaged, including an issuer's excepted benefits, is the best reading of the section 1557 statutory language, which applies to “any health program or activity, any part of which is receiving Federal financial assistance.”42 U.S.C. 18116(a) (emphasis added).

Comment: A few commenters raised concerns with the sufficiency of the Proposed Rule's discussion on excepted benefits. These commenters asserted the Proposed Rule did not adequately explain why subjecting excepted benefits to the rule is necessary or appropriate. Commenters stated that the regulatory text does not address excepted benefits and that the preamble discussion does not explain how the rule would apply to excepted benefits. Thus, according to commenters, there was insufficient notice for public comment, which they assert would likely subject the final rule to legal challenge as violative of the Administrative Procedure Act. These commenters argued OCR should issue a new Proposed Rule with comment period that explains how OCR intends to address excepted benefits and provides additional clarity on how the rule will apply to excepted benefits, taking into account the specific nature and legal structure of such products that Congress made statutorily distinct from major medical products. Commenters also objected to the Proposed Rule's investigative approach to evaluate claims of discrimination on a case-by-case basis, with one commenter arguing the case-by-case approach indicated a “regulation-by-audit scheme.”

Response: We disagree that the Proposed Rule failed to adequately provide notice and opportunity to comment on OCR's reasoning regarding the applicability of section 1557 to all operations of a recipient health insurance issuer that is principally engaged in the provision or administration of health insurance coverage or other health-related coverage. We fully discussed OCR's legal authority and reasoning regarding this scope of coverage in the Proposed Rule's discussion of the definition of “health program or activity” under § 92.4. 87 FR 47844-45. We also disagree that the Proposed Rule did not provide notice to the public of the ter